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Loop Mobile is set to wind down its services by November-end, even as the company management is confident of securing regulatory clearances for the proposed deal with Bharti Airtel.
“…we would like to inform you that we will be closing our services on November 29,” the Mumbai-based operator said in a text message to its subscribers today.
The intimation was made following a directive from the Telecom Regulatory Authority of India (TRAI), which had required Loop to inform its subscribers about the date of closure of its services, either in writing or by sending an SMS.
Loop’s licence and spectrum are set to expire on November 29. The company had to buy spectrum afresh to continue its operations, but it did not participate in the auction held in February.
In February, Airtel announced the acquisition of Loop in a move that would help the country's largest operator by subscribers strengthen its presence in Mumbai. While the financial details of the deal were not disclosed, media reports pegged it at about ₹700 crore.
Asset transferLoop’s application to transfer assets to Bharti Airtel has been pending for more than six months.
However, Loop officials are confident that the deal is on track with the DoT approval expected as early as next week.
Speaking to Business Line , Surya Mahadevan, Chief Operating Officer of Loop Mobile, said: “Our expectation is that the DoT will approve the business transaction as proposed by us. In a week’s time, we will have 100 per cent clarity on the DoT guidelines and the timeline for subscriber migration to Bharti Airtel.”
However, he did not comment on how Loop would deal with its debt situation if the deal with Bharti Airtel does not go through.
Loop’s active subscriber base currently stands in the 12-13 lakh range, said Mahadevan, adding that there has been churn in the last few months.
News reports estimate that Loop Mobile and its other sister concern owe DoT about ₹808 crore. The deal with Bharti Airtel has been delayed as TRAI had disallowed the transfer of subscribers to the acquirer as part of the transaction.
The telecom regulator had also issued a notice to Loop, asking it to inform its subscribers to shift to an operator of their choice before the closure of its service.
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