Spice gets the Idea for Reliance on each other
Spice Telecom, Idea Cellular and Reliance Telecom (the GSM arm of Reliance Communications) are in talks for forging an “operational alliance with a pan-India footprint”, according to MCorp global chairman B K Modi.
By Joji Thomas Philip, TNN |
NEW DELHI: Spice Telecom, Idea Cellular and Reliance Telecom (the GSM arm of Reliance Communications) are in talks for forging an “operational alliance with a pan-India footprint”, according to MCorp global chairman B K Modi.
“Discussions are on for an operational alliance with regard to network sharing, roaming, international arrangements and handset bundling,” Mr Modi told ET. “The talks are not related to any merger, but relate to a tie-up for operational requirements,” he added. Mr Modi, however, did not disclose the specifics of the proposed alliance.
When contacted, Idea Cellular managing director Sanjeev Aga told ET that he was not aware of any such development. Reliance Telecom refused to comment on the issue.
Meanwhile, in a related development, Spice Telecom on Wednesday got the Sebi nod for its upcoming initial public offer. Telecom Malaysia currently has a 49% stake in Spice, but this will fall to 39.2% after the mobile operator’s IPO.
According to the latest figures from the Cellular Operators Association of India (COAI), the body representing all GSM operators, as of April-end, Spice had 2.8 million subscribers, while Idea Cellular had just under 15 million and Reliance Telecom under 5 million.
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Analysts, however, share the view that the operational alliance was a logical move as all three companies did not have an pan-India presence. Idea currently has operations in 11 circles—Maharashtra, Gujarat, Andhra Pradesh, Madhya Pradesh, Delhi, Kerala, Haryana, Uttar Pradesh (West), Uttar Pradesh (east) and Rajasthan— Spice has operations in Punjab and Karnataka, while Reliance Telecom has GSM operations in eight telecom circles in the eastern part of the country.Reliance Telecom has GSM operations in Kolkata, Madhya Pradesh, West Bengal, Himachal Pradesh, Bihar, Orissa, Assam and the North East.
This implies, if the operational tie-up were to take place, the three companies will have a presence in 19 of the 23 telecom circles in India. The four circles where none of these companies have a presence include Mumbai, Chennai, Tamil Nadu and Jammu & Kashmir.
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