4th cellular license: Bharti wins lion’s share in bids

Bharti Enterprise may well be on its way to become a cellular giant, with the

firm bagging five out of 15 circles in the second round of bids for the fourth

cellular licence.

The circles that went to Sunil Mittal’s Bharti include Tamil Nadu, Haryana,

Kerala, UP (West) and the coveted Mumbai circle. The firm has already won Madhya

Pradesh in the first round of the bidding, as the sole bidder.

With this acquisition, Bharti is all set to expand operations in all four

metros, since the firm has already made an acquisition of Spice in Kolkata. It

will also have a share in the emerging cities like Bangalore and Hyderabad. The

firm will be garnering a customer base of nearly 8 lakh. With these licenses and

acquisition, Bharti is not expected to go in for any newer acquisitions in the

near future.

As for the other licencees, Hutchison won Andhra Pradesh while Reliance

bagged the Kolkata circle. The third round of bidding will be on July 19 and

would be held for eight circles, namely: Delhi, Chennai, Karnataka, Maharashtra,

Gujarat, UP (east), Punjab and Rajasthan. Reliance had originally bid for 15

circles, but was out of bidding in all eight remaining circles, thus bagging

only the Kolkata circle.

This final round of bidding will be tough and a keen tussle is expected

between Hutchison and BPL-Batata in Chennai & Karnataka and Bharti in

Maharashtra. Bharti will also have a face-off with Escotel in Gujarat, UP (east)

and Rajasthan. Escotel will also face intense competition from Ind Mobile in

Punjab.

With this round of bidding, the expected revenue to be generated as licence

fee for the government will be around Rs 1,484 crore. The figure is Rs 196 crore

more than what was garnered in the first round of bidding.

Bharti adds Spice to its operation



Meanwhile, in bid to expand its operations in Kolkata, Bharti Telecom has
acquired Modicorp’s Spicecell. The all-cash deal worth nearly $90 million has

enabled Bharti to claim 100 per cent equity stake in the mobile phone firm.

Modicorp and Ditacom had owned SpiceCell in the ratio of 51:49.

Bharti has already paid Rs 100 crore as advance payment while the balance

will be paid once the other legal formalities are completed. The deal was worked

out through Lazard India, which acted as bankers and advisers to the Bharti

group.