Bharti acquires 49 per cent share of Qualcomm's India unit at cut-price

India’s Bharti Airtel has signed an agreement with Qualcomm to acquire 49 per cent of its Indian BWA entities.

Qualcomm acquired the wireless broadband service permits in India for four states in the country in 2010 for $1bn. The purchase was made in a deliberate bid to block the progress of WiMAX as an alternative 4G technology in the country, Qualcomm CEO Paul Jacobs said at the time. Now, it has sold the 49 per cent stake to Bharti for just $165m.

Bharti is acquiring its stake by purchasing a 26 per cent share held by two Indian partners in the Qualcomm broadband venture, Global Holding Corporation and Tulip Telecom and by subscribing to fresh equity. Once commercial operations are launched, subject to certain terms and conditions, the plan is for Bharti to assume complete ownership and financial responsibility for the BWA entities by the end of 2014.

“This partnership will combine the strength of Bharti’s national telecom footprint and Qualcomm’s technological leadership in the LTE TDD space,” said Sunil Bharti Mittal, chairman and managing director, Bharti Airtel.  With a broadband ready network across India, Bharti is well positioned to lead the next phase of Indian’s telecom revolution.”

Paul Jacobs added that one of the firm’s key objectives has been to include a strong partner in the Indian venture with the scale, experience and resources to deploy LTE TDD networks.

“GHC and Tulip have been great partners in facilitating this transaction. Qualcomm remains dedicated to the continued progress and success of the BWA venture and to fulfilling our commitment as a key equity stakeholder,” he said.

Qualcomm’s licences cover Delhi, Mumbai, Haryana and Kerala, and Bharti already has BWA licences of its own in four circles: Kolkata, Karnataka, Punjab and Maharashtra, as well as and 3G licences in thirteen circles. It has already launched 4G services in Kolkata and Karnataka.

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