Airtel buys Loop Mobile, to get 3 million users

India's largest cellular carrier Bharti Airtel will buy mobile operator Loop Mobile in a move that will make Bharti the biggest mobile operator in Mumbai in terms of users. This would be the first merger in the country's telecoms market in nearly six years. Under the agreement, Loop Mobile's 3 million subscribers in Mumbai will join Airtel's over 4 million subscribers in the city. A Reuters report citing sources said that Bharti would pay Rs. 300 crore and take on Rs. 400 crore of debt held by Loop. The agreement will ensure continuity of services for Loop Mobile's subscribers as Loop's spectrum licence lapses in November this year. Bharti recently acquired the crucial 900 MHz band in Mumbai in the recently concluded spectrum auction which will help it compete more aggressively with Mumbai's market leader Vodafone. Bharti Airtel shares were down 0.48 per cent at Rs. 303. Commenting on the deal, Karan Mittal of ICICI Direct said, "It's a good move and points towards consolidation in the telecom industry. Bharti Airtel shares might have reacted negatively on rising debt, but it's a good buy and will help the company take on Vodafone and later Reliance Jio in the Mumbai market." ICICI Direct has a buy call on Bharti Airtel with a target of Rs. 385. Bharti Airtel will not only get Loop Mobile's subscribers, but also Loop's network of over 2,500-plus tower sites. According to Mr Mittal, 33 per cent of Loop's subscribers are post-paid users with its average revenue per user in Mumbai higher than Airtel in the city. So it is a good deal for Airtel, he added.   NDTV