Indian cellco Hutchison Essar Teleholdings has purchased Tamil Nadu and Chennai operator Aircel for approximately USD360 million, in the process trumping a rival bid of around USD270 million from fellow Indian mobile heavyweight Bharti Tele-Ventures. The acquisition of Aircel, which currently has around 855,000 subscribers, will take Hutchison Essar’s customer base to around 6.5 million. It follows a string of recent deals in the Indian mobile market which, although still highly fragmented, is slowly beginning to consolidate around a handful of large players. Although it lost out to Hutchison in the Aircel deal, Bharti Tele-Ventures has made a series of purchases over the past twelve months, including a 68% stake in Rajastan-based operator Hexacom, and now has operations in 17 of the country’s telecoms ‘circles’. The company is said to be eyeing India’s third largest cellco, Idea Cellular, and is currently in talks with the operator’s three owners – the local Birla and Tata groups, as well as US-based Cingular Wireless – about buying 100% of the company in a part cash-part equity deal. Whilst Bharti wants to pay 25% in cash, 25% in debentures and 50% in equity, the three sellers are looking for a cash only deal. If an agreement can be reached it would be the biggest consolidatory deal in the sector’s history
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