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    DoT may not look into Jio’s complaint against Airtel's Tikona Digital deal

    Synopsis

    Airtel had said that it is acquiring Tikona Digital’s 4G business, along with its 4G spectrum, in Gujarat, UP, Himachal Pradesh and Rajasthan for about Rs 1,600 crore.

    ET Bureau
    NEW DELHI: The Department of Telecommunications (DoT) is likely to refrain from looking into Reliance Jio's complaint against Bharti Airtel's buyout of Tikona Digital's 4G business on the ground that the contours of the deal do not fall under its purview.

    “Structuring of corporate (deals) is not part of DoT’s mandate… there are institutional, legal mechanisms and authorities to check it,” a senior official aware of the details of the matter said.

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    The official, however, said that if the deal makes Airtel’s spectrum cap or revenue market share holding higher than that permitted under the country’s merger and acquisition rules, the department would flag the issue.

    Image article boday


    Mukesh Ambani-owned Jio and Sunil Bharti Mittal-promoted Airtel are engaged in a war of words over a host of issues, including inadequate interconnections, allegations of cartelisation and blame-trading for the sector’s poor financial health.

    Airtel had said in March that it is acquiring Tikona Digital’s 4G business, along with its 4G spectrum, in five circles — Gujarat, UP (east), UP (west), Himachal Pradesh and Rajasthan — for about Rs 1,600 crore. The deal, which needs a string of approvals including DoT’s to go through, was aimed at ramping up the telco’s 4G spectrum capacity to take on Jio and the Vodafone-Idea Cellular combine.

    Jio had alleged that market leader Airtel was exploiting a gap in M&A rules, masking a spectrum trading agreement as an M&A deal to circumvent paying Rs 217 crore to the government for migrating Tikona’s broadband wireless access (BWA) spectrum from an internet service provider licence to the unified licence (UL) regime, which allows a company to offer voice services.

    Airtel, however, denied the allegations, saying that it was compliant with government rules, and called out Jio’s attempts to “throttle/block competition”.

    In a letter to DoT and the National Company Law Tribunal last month, Jio had sought intervention and rejection of the proposed Airtel-Tikona transaction till Airtel has paid the differential licence fee, to ensure level playing field.
    The Economic Times

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