Bharti Qualcomm takeover marred by murky spectrum rules

7 Oct 2013

Bharti Airtel’s plan to wholly own the Qualcomm’s Indian wireless broadband arm may be derailed by unclear rules regarding the purchase of spectrum, the Economic Times writes. Qualcomm was awarded 2300MHz spectrum in four circles in 2010 via its Wireless Business Service unit. Airtel took a 49% stake in the company in May 2012, increasing its holding to 51% in August this year and recently upped its stake to 93.45%, announcing plans to fully take over the company by November 2014. However, the Department of Telecommunications (DoT) has pointed out that under the terms of the 2010 auctions, successful bidders that were newcomers to the sector were required to keep a 26% stake, but failed to specify for how long that stake must be retained. The DoT is now reviewing whether the equity was required to be held until the winner was allocated an internet service provider (ISP) licence or must be held for the tenure of the spectrum. In the latter case, Airtel’s increased holding would be illegal.

India, Bharti Airtel, Department of Telecommunications (DoT), Qualcomm (India)