Bharti To Buy 49% In Qualcomm India Broadband Venture

Bharti Airtel , India’s biggest mobile phone carrier, said it had signed a pact to buy a 49% stake in Qualcomm Inc’s fourth-generation (4G) broadband venture in the country for USD 165 million.

The deal will be partly by way of acquisition of 26% equity interest equally held by Global Holding Corporation Private Limited and Tulip Telecom Limited, and the balance by way of subscription of fresh equity in those entities.

The agreement contemplates that once commercial operations are launched, subject to certain terms and conditions, Bharti would assume complete ownership and financial responsibility for the BWA entities by the end of 2014.

Bharti already has BWA licenses in four circles - Kolkata, Karnataka, Punjab and Maharashtra - and 3G licenses in thirteen circles in India. With this agreement, Bharti has secured a nation-wide broadband leadership through a combination of 4G and 3G, with its own networks in 18 circles.

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Qualcomm expects to provide technical assistance to Bharti in connection with network architecture and optimisation, infrastructure and device testing, as well as continuing to develop and support the underlying technology and the LTE TDD ecosystem.

A spokesperson of Tulip Tele told CNBC-TV18 that the deal will strengthen the company’s balance sheet. Tulip Tele had an investment of around Rs 140 crore in Qualcomm. The company plans on using the money for the payment of its outstanding FCCBs.