Airtel to merge VSAT business with Hughes India
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India’s Bharti Airtel has agreed to merge its domestic satellite operations with Hughes Network Systems’ Indian subsidiary Hughes Communications India.
The companies will combine their very small aperture terminal (VSAT) satellite operations in a bid to benefit from enhanced scale, improved operational efficiencies and wider market reach.
Under the agreement, Hughes will take a majority stake in the combined entity, with Airtel owning a significant minority stake.
The combined company will continue to serve existing Hughes and Airtel customers while introducing new VSAT and related technologies in the Indian market.
“We are very excited about the synergies that this partnership will bring to the Indian ecosystem,” Hughes Communications India president Partho Banerjee said.
“These are exciting times for satellite broadband service providers as VSAT becomes more mainstream, driven by growing demand from both, enterprise and government segments.”
Airtel Business director and CEO Ajay Chitkara added that the tie-up is aimed at better serving the connectivity needs of what he called Digital India.
“The partnership will bring amazing synergies to the forefront and combine the proven capabilities of both the companies. Customers can look forward to highly secure and reliable connectivity solutions across the length and breadth of India,” he said.
Questions & Answers
Q.What is the primary motivation for Airtel and Hughes to merge their VSAT operations?
What is the primary motivation for Airtel and Hughes to merge their VSAT operations?
The companies aim to benefit from increased scale, better operational efficiencies, and a broader reach within the market. This merger intends to serve the connectivity needs of what has been termed Digital India.
Q.Which company will have the controlling interest in the new combined entity?
Which company will have the controlling interest in the new combined entity?
Hughes will hold a majority stake in the combined satellite operations. Airtel will retain a significant minority stake in the new company, reflecting their contribution to the merger.
Q.What specific customer segments are driving the growth in demand for VSAT services?
What specific customer segments are driving the growth in demand for VSAT services?
The growing demand for VSAT services is primarily driven by both the enterprise and government segments. This indicates a broader acceptance and need for satellite broadband solutions across various sectors.
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