TeleGeography Logo

Telenor considers joining RCOM/Aircel/SSTL merger

1 Feb 2017

As pressure for consolidation continues to ramp up in India’s mobile market, Norwegian-owned cellco Telenor India has approached Aircel and Reliance Communications (RCOM) regarding a potential tie-up via a share swap, the Economic Times reports, citing three executives familiar with the matter. RCOM and Aircel are currently working towards merging their businesses, though a Supreme Court ruling threatening to revoke Aircel’s spectrum licences has cast doubt on the deal. According to the officials, Telenor is willing to throw its lot in with the duo, despite the uncertainty, with Telenor expected to take a 10% stake in the enlarged company, whilst RCOM and Aircel would each own 45%. One of the unnamed executives was quoted as saying of the deal: ‘Discussions among the three had started around last Christmas but it has been in a limbo for the last few weeks due to the Supreme Court shadow over Aircel’s local operations. By the end of this week, there will be clarity on that front. If the court decides to quash the Aircel licence, then even the bigger Aircel/RCOM merger will collapse.’

Meanwhile, Telenor is reportedly still involved in talks with market leader Bharti Airtel, with the larger operator considering buying out the smaller provider to further build up its spectrum portfolio and shore up its subscriber base amidst intensifying competition.

As noted by TeleGeography’s GlobalComms Database, in addition to its long-awaited merger with Aircel, RCOM has also agreed to acquire the wireless business of Russian-owned Sisteam Shyam TeleServices (SSTL, operating under the MTS India brand). Under the terms of the deal, agreed in November 2015, SSTL’s mobile business will be demerged into RCOM, while SSTL will take a 10% equity stake in RCOM.

Based on the regulator’s subscriber data for September 2016, a four-way merger of Telenor, RCOM, Aircel and SSTL would create an operator with a subscriber base of 236.88 million – equating to a market share of roughly 22.6% – putting the enlarged cellco in second place behind Bharti Airtel’s 259.94 million users at that date.

India, Aircel, Reliance Communications (RCOM), Sistema Shyam TeleServices (SSTL, MTS India), Telenor India

GlobalComms Database

Want more? Peruse the GlobalComms Database—the most complete source of intel about mobile, fixed broadband, and fixed voice markets.


TeleGeography is the definitive source for telecom news, numbers, and analysis. Explore the full research catalog.