Qualcomm (NASDAQ:QCOM) likely will sell its India TD-LTE wireless venture to Indian operator Bharti Airtel for around $1.2 billion, according to a report in the Indian media.
The report on the news channel ET NOW, which cited unnamed sources, said the chip maker is in advanced negotiations with Airtel, India's largest operator, to purchase the venture, which was formed last year. The report said the exact valuation could be between $1.2 billion and $1.3 billion, representing a 25-30 percent premium on the $1.05 billion Qualcomm paid for spectrum in India's BWA spectrum auction last year.
In an email statement to the Economic Times, Qualcomm reiterated its intent to foster TD-LTE technology in India and then exit its venture. "Consistent with those goals, discussions with 3G operators in India on LTE TDD commercialization and commercial discussions related to Qualcomm's BWA spectrum are indeed ongoing," the company said. "These discussions are however confidential and Qualcomm cannot comment on speculation regarding specifics."
Qualcomm CEO Paul Jacobs indicated in November that the company intended to sell off spectrum in the TD-LTE venture. He told Reuters the company bought broadband spectrum in the country to ensure that LTE would get deployed, but that it never intended to operate a network and does not want to compete with its partners.
Qualcomm formed a joint venture in August with India's Global Holding Corp. and Tulip Telecom. Qualcomm owns the majority of the venture, with the Indian firms each holding 13 percent. The JV has invested in three local firms: Wireless Broadband Services (Haryana) Pvt. Ltd., Wireless Broadband Services (Delhi) Pvt. Ltd., and Wireless Broadband Services (Kerala) Pvt. Ltd.
During the auction, Qualcomm secured licenses in four service circles: New Delhi, Mumbai, Kerala and Haryana. Airtel paid $740 million to get broadband spectrum licenses in the areas of Karnataka, Maharashtra, Kolkata and Punjab.
For more:
- see this Economic Times article
- see this Dow Jones Newswires article (sub. req.)
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