Tata Teleservices may reopen spectrum trading talks

Our Bureau Mumbai | Updated on January 20, 2018 Published on June 26, 2016

Tata Teleservices may reopen talks with other telecom companies, including Vodafone, for spectrum trading deal in a bid to raise funds to pay for NTT Docomo’s stake. An international court has ordered the Tata group to pay $1.17 billion to NTT Docomo for the equity stake held by the Japanese company.

According to industry sources, Tata Teleservices could look at selling some of its spectrum in the 800 MHz and 1800 MHz bands to raise money. At least two people close to the company indicated that feelers to other operators are being sent. A number of operators including Vodafone and Telenor had looked at doing a possible deal with Tata Tele. These discussions did not lead anywhere at that time because regulatory issues around spectrum trading were not clear. There was also uncertainty around the arbitration proceedings initiated by NTT DoCoMo. “Now that there is clarity both on the policy front and on the legal front, Tata Tele may re-start those negotiations,” said one of the sources cited earlier.

However, it may not be easy for Tata Tele to do a deal quickly. Most of its holding in the 1800 MHz band has been administratively allocated, under the earlier subscriber linked criteria regime, and therefore cannot be traded. Tata Tele will first have to pay the market price for the spectrum it owns to the Government and then look for trading deals. But that could reduce the net proceeds for the company from the sale of spectrum.

The other option would be to trade its 800 MHz band, which the company has been using for CDMA services. This band is now being eyed for offering 4G services and may be useful for other operators. But its licence for spectrum in Andhra Pradesh, Mumbai and Maharashtra are expiring soon.

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Published on June 26, 2016
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