India’s largest telecom operator (by subcriber base) Bharti Airtel has acquired Videocon Telecom for Rs 4,428 crore.
Post the deal, Bharti’s 4G coverage will go upto 19 circles from the current 15.
Nitin Soni of Fitch Ratings says that the investment will bring-in reasonable returns for Bharti. While the ratings remain unchanged, credit quality of Bharti is expected to improve over a period of time, he adds.
Naveen Kulkarni of PhilipCapital says that considering what Idea was paying for two circles, Bharti will be paying for all six circles. The deal certainly does not look bad.
Kulkarni further says that Bharti, which already has spectrum, needs more in certain circles. “More spectrums always help,” he says. Videocon, as well, is making good money on the deal, Kulkjarni adds.
At 11:17 hours IST, the scrip of Bharti Airtel was quoting at Rs 348.20, up Rs 8.55, or 2.52 percent while Videocon Industries rallied 14.7 percent to Rs 125.8 on the Bombay Stock Exchange.