Bharti Airtel has acquired 100 per cent stake in the Wireless Business Services (WBSPL), a company founded by the US-based chipmaker Qualcomm.
The company had acquired a 49 per cent stake in WBSPL in May 2012 for $165 million followed by another 2 per cent stake in July 2013.
Currently, WBSPL holds 4G spectrum in the Delhi, Mumbai, Haryana and Kerala circles, whereas Bharti Airtel holds 4G spectrum in the circles of Punjab, Maharashtra, Kolkata and Karnataka.
The announcement comes at a time when the Department of Telecommunications (DoT) is deliberating whether a company like WBSPL, which acquired an internet service provider?s (ISP) licence on winning broadband wireless access (BWA) spectrum in the 2010 auctions, can dilute promoter?s stake to below 26 per cent. After acquiring BWA spectrum, Qualcomm got on board two Indian partners – Global Holding Corporation and Tulip Telecom to abide by the foreign direct investment regulations which allowed a foreign-based company to hold 74 per cent stake in a telecom venture.
The notice inviting application (NIA) issued before the 2010 auctions mandated that the successful bidder, who is a ?new applicant? and not an existing one, must retain at least 26 per cent stake in the company, but the NIA did not mention the time till which such stake must be retained.
Currently, DoT is ascertaining whether the equity had to be maintained until acquiring the ISP licence after a company won the spectrum, or was it to be maintained until the tenure of the spectrum. In case of the latter, the proposed equity structure between Bharti Airtel and Qualcomm would make the deal illegal. Meanwhile, DoT has sought details from Bharti Airtel and Qualcomm on the equity structure following the deal.
