Vodafone India may buy out Telenor India

Vodafone India is reportedly the frontrunner for acquiring Telenor’s Indian spectrum holdings and operations in a deal that could be worth over $1 billion.

Two people close to the negotiations said that Vodafone India is pursuing the deal to help it better compete in the battle over mobile data customers.

The sources differed over whether the deal would involve only acquiring Telenor’s Indian spectrum holdings or the company as well. But they both told the publication that Telenor India’s 1800-MHz spectrum is valued at around $1 billion.

Spectrum is the main draw of the acquisition, but if Vodafone does buy Telenor India’s operations as well it may involve taking on Telenor India’s significant debt and try to remain the operator’s customers in key service areas.

Vodafone currently only possess 4G spectrum in five of India’s 22 telecoms circles, whereas rival Bharti Airtel and the soon-to-launch Reliance Jio have pan-India holdings and Idea Cellular has 4G spectrum in 10 circles. Acquiring Telenor’s Indian spectrum would help even the playing field.

Telenor India operates in seven telecoms circles, but its customer base remains relatively low after eight years of operation.

Vodafone India has declined to comment specifically on the matter, but a spokesperson confirmed that the company is open to options including spectrum trading and M&As.