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Telenor exit may portend trend

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Telenor exit may portend trend

[vc_row][vc_column][vc_column_text]No longer wise to wait for valuations to rise before selling out; market reset likely to yield three main players

By Sindhu Bhattacharya

The valuation at which Norwegian telecom operator Telenor agreed to sell off its Indian operations to Bharti Airtel last week reveals a lot more besides just the seller’s desperation to cut losses and run. It shows why all other small telecom operators still braving it out in the world’s second largest telecom market may need to also hasten their exits.

This is no longer a game for the weak hearted, and as the Telenor deal shows, it is also no longer wise to wait for valuations to rise before the small guys start thinking of selling out. Yes, the changed telecom market reality has partly been engineered by the arrival of Reliance Jio Infocomm last September in an already crowded market. Another reason could also be the abundant spectrum availability for major telcos after the last round of auctions which has cooled the appetite of big operators to pay any premium to acquire the smaller rivals. Telenor did well to absorb its losses and exit while there was still a taker. And Bharti has gained not just in money terms but also by stocking up on spectrum for future wars with RJio on the data front.

According to analysts, the Bharti-Telenor deal was concluded at just about Rs 2,000 crore when they were expecting the deal size to be up to four times more for Bharti to acquire Telenor’s spectrum, customers and employees. Telenor had said while announcing the deal that Bharti would only acquire outstanding spectrum payments and other operational contracts including tower lease, which led analysts to conclude that Bharti will invest just Rs 2,000 crore in the deal.

Analysts from brokerage Motilal Oswal said in a note to clients this morning that after the recently-concluded auction, there were limited takers for incremental spectrum in the market. This made it difficult for Telenor to get any premium whatsoever for its significant spectrum holding in some of India’s most populous telecom circles.  Given the impending merger of number two and three telecom operators, Vodafone and Idea Cellular; the already inked RJio-RCom spectrum sharing terms; and the fact that no sizeable operator was willing to take its spectrum, Telenor was anyway left with limited options. This may have led to the low valuation in its deal with Bharti. The bottomline is that the deal worked in Bharti’s favour because it came so cheap.

These analysts further said that at a potential investment of about Rs 2,000 crore for Bharti, generating operating cash flow of Rs 32,000 crore and net debt of Rs 102,000 crore, “the investment would add hardly 2% to net debt, which would be offset by the EBITDA contribution from the merger.”

Also read: Telenor’s painful exit and the writing on the wall

This piece points out that as consolidation has picked up pace in India’s telecom market, sellers are settling for lower and lower valuations. “Telenor even settled for nothing, despite having 44 million customers and nearly Rs 5,000 crore in annual revenues; leave alone the value of its spectrum.”

The Motilal analysts quoted earlier said the Bharti-Telenor deal bolsters Bharti’s defence against RJio. While the incremental spectrum Bharti gets as part of this deal may not be presently required, given the large-scale data traffic on RJio’s network, holding high quantum of spectrum would allow Bharti to compete with RJio in a fixed-cost-driven market. “We believe Bharti’s strategy to remain ahead of the curve in data-rich spectrum investments should hold it in good stead”.

Not just the Bharti-Telenor deal, smaller telcos need to also take a lesson from other M&As being lined up. Already, the number two and three telecom operators in India. Vodafone and Idea Cellular, are in merger talks. If this merger happens, then the merged entity and Bharti will together control over 70% of India’s telecom market share by revenue. This obviously spells doom for remaining small players. Industry estimates peg post-merger market share for Tata Teleservices at 6.5%, BSNL and MTNL combine at 5%, Aircel at 5.7% and Sistema at 4%. Reliance Communications (RComm) is estimated to be close to Sistema’s share at 4.2%.

Also read: Vodafone, Idea merger plans leave Tata Tele in a fix

The market has space for four or at best five strong operators to play. Any more and it will become a very uneven playing field. Already, RJio’s freebies have spurred others to enter a bruising price war. As RJio’s commercial launch nears its April one deadline, competitors like Bharti and Vodafone will start offering competing plans – RJIo has promised voice calls for free and no charges for national roaming and there are already indications that at least Bharti will match these offers.

Also read: Tata in early talks to join RCom-Aircel-MTS combine to take on Jio

This piece speaks of a possible merger of Tata Teleservices with the RComm, Aircel, MTS combine and goes on to say that such a move could create a strong number three telco behind the proposed Vodafone-Idea combine and Bharti Airtel.[/vc_column_text][/vc_column][/vc_row]

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Google restores delisted Indian apps after government intervention

Google on Saturday restored all Indian apps it had removed.

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Google has started to restore all the delisted Indian mobile apps on Play Store agian, which they had removed due to a disagreement over service fees. After a discussion between company representatives and IT Minister Ashwini Vaishnaw, the decision was made, according to sources.

The step was taken in response to Vaishnaw’s strong statement in which he said that it is not allowed for apps to be removed from the Google Play Store. The minister had said, India is very clear, our policy is very clear…our startups will get the protection that they need.

Vaishnaw  continued saying that he has already given Google a call. They will be speaking with the app developers who were delisted this week. This is not acceptable. The minister said this kind of delisting cannot be permitted.

Ten Indian companies’ apps were banned by Google on Friday, causing outrage in one of its fastest-growing markets. With 94% of phones running on its Android platform, Google holds a large portion of the Indian market. Popular names like Naukri and Bharatmatrimony were on the list.

The main point of contention is Google’s in-app purchase fees, which range from 11% to 26%. Indian startups have long opposed the US tech giant’s actions, believing them to be unfair.

The founder of Bharat Matrimony, Christian Matrimony, Muslim Matrimony, and Jodii, Matrimony.com, expressed shock at the matchmaking apps’ removal from the Google Play Store.

Shaadi. Com CEO Anupam Mittal described it as a dark day for India’s internet, highlighting the possible broad effects on matchmaking services. He also called Google an evil.

While, Kuku FM Co-founder Vinod Kumar Meena in a statement had said that Google was behaving like a monopoly.

Meanwhile, Google temporarily withdrew the famous Indian payments app Paytm from the Play Store in 2020, claiming a few policy infractions. Due to this decision, the founder of the company as well as the larger startup community came together to build their own app stores and file lawsuits against Google.

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Anant Ambani says he is 100% lucky to get Radhika Merchant in his life

Anant Ambani said he was grateful to get Radhika as his life partner. He said he is 100% lucky to get Radhika Merchant in his life. He said every day he is falling more and more in love with her. He added although he had known Radhika for the last 7 years, it felt he had met her only yesterday. He thanked Radhika for everything.

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Anant Ambani and Radhika Merchant’s grand three-day wedding celebrations began with a glamorous cocktail night on Friday in Jamnagar. During the celebrations, Anant Ambani also gave a speech wherein he thanked his late grandfather Dhirubhai Ambani and grandmother Kokilaben Ambani for inspiring him. Anant Ambani said he was grateful to get Radhika as his life partner. He said he is 100% lucky to get Radhika Merchant in his life. He said every day he is falling more and more in love with her.

He expressed his gratitude to his mother for pulling together the lavish three-day wedding celebrations in Jamnagar. Anant thanked his mother for all she had done. He said all the arrangements had been done by his mother and nobody else. He added his mother had gone all out and she had worked 18-19 hours a day and he was extremely grateful to her.

He also thanked all the guests who were present there at the pre-wedding celebrations. He said everyone had made it to Jamnagar to make him and Radhika feel special. He said both of them were honored and humbled to have all of them present there. Anant said he was sorry if they had caused an inconvenience to anyone. He asked for forgiveness. He hoped everyone is going to enjoy the coming three days. He also thanked his mother, father, sister, brother, his sister-law and his brother in-law for making this event memorable.

Anant said everyone has been sleeping for less than 3 hours a day for the last 2-3 months and he was very happy to share this joy with everyone. The youngest Ambani talked about his personal struggles and how his parents had always supported him. He further added his life had not been entirely a bed of roses. He said he had also experienced the pain of thorns. He said he had faced many health crises.

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Facebook chief Mark Zuckerberg shares pictures from 2nd day of Anant Ambani and Radhika Merchant pre-wedding celebrations

Zuckerberg shared pictures from the 2nd day of Anant Ambani and Radhika Merchant’s pre-wedding celebrations. In the photograph Mark Zuckerberg can be seen along with his wife Priscilla Chan. The couple is exuding happiness as they prepare for the event. He captioned the picture it is getting wild out here.

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Facebook boss Mark Zuckerberg and wife Priscilla Chan joined the star- studded pre-wedding celebrations of Anant Ambani and Radhika Merchant in Jamnagar on Friday. The event was attended by many prominent figures from different fields. Zuckerberg took to his Instagram handle congratulated the couple and said he loved Indian weddings.

Zuckerberg shared pictures from the 2nd day of Anant Ambani and Radhika Merchant’s pre-wedding celebrations. In the photograph Mark Zuckerberg can be seen along with his wife Priscilla Chan. The couple is exuding happiness as they prepare for the event. He captioned the picture it is getting wild out here.

The theme of the opening day of the pre-wedding celebrations was Evening in Everland as the guests wore cocktail attire. The first day of the grand celebrations elevated the expectations of the guests for the following days. The theme of the 2nd day of the pre-wedding bash is known as a Walk on the Wildside and the guests can be seen in Jungle Fever attire.

Zuckerberg has opted for an animal print shirt with white trousers, Chan is complementing his look in a strappy one piece in black and golden. The Jungle theme is aligned to Vantara, Reliance’s animal welfare initiative undertaken and launched by Anant Ambani a few days back.

International pop star Rihana electrified the pre wedding celebrations on Friday with an amazing performance, marking her debut appearance in India. The chart topping artist engaged the audience with performances of her iconic hits which included Pour it Up, Work and Diamonds.

Zuckerberg graced the opening day, wearing a black-on-black firefly blazer and shoes from Alexander McQueen while his wife Priscilla wore a black gown with gold flower details and other accessories such as dainty chain bracelet, gold necklace and stud earrings. Mark Zuckerberg and wife Priscilla Chan are one of the Power couples invited from the global business community for the festivities currently underway at Jamnagar.

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