After media speculations about a possible merger of Airtel Direct-to-Home (DTH) and Tata Group’s DTH businesses, Bharti Airtel on Wednesday confirmed that bilateral discussions on the deal are underway.
According to a report published in Business Standard, Bharti Airtel said in an exchange filing that Bharti Airtel Limited (‘Airtel’) and TATA Group are in bilateral discussions to explore a potential transaction to achieve a combination of TATA Group’s Direct To Home (‘DTH’) business housed under Tata Play Limited, with Bharti Telemedia Limited, a subsidiary of Airtel, in a structure acceptable to all parties.
Previous media reports suggested that Airtel would acquire a majority stake (52-55%) while Tata Sons and Walt Disney would hold a combined stake of 45-48 percent. If the deal takes place, the Airtel-Tata Group DTH merger would be the biggest deal in the country. It allows the entity to compete with JioStar and players in the segment.
Last week, the Telecom Regulatory Authority of India (TRAI) gave big relief to direct-to-home (DTH) service providers.
In its recommendations for broadcasting services under the Telecommunications Act of 2023, it proposed reducing the licence fee for DTH service providers to 3 per cent of AGR as against the current 8 per cent. It also recommended no authorization fee after 2026-27.
TRAI also recommended reducing the bank guarantee requirement for DTH and Headend-in-the-Sky (HITS) services, lowering the processing fee for HITS services from Rs1 lakh to Rs10,000, and extending the validity of HITS service authorization from 10 years to 20 years, with a renewal option every 10 years.
