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A Timely Call

The much talked about consolidation in telecom finally gets underway with the RCom-Aircel merger

After a deadline that was extended twice, the Anil Ambani-owned Reliance Communications (RCom) has finally inked an agreement with Aircel, run by Malaysia’s Maxis Communications, to merge their wireless businesses. This comes as a much needed relief to both companies that are struggling with debt and the threat of being marginalised in the wake of Reliance Jio’s aggressive entry earlier this month.

This merger will place the combined RCom-Aircel entity at third in the pecking order with over 190 million subscribers after BhartiAirtel and Vodafone, and ahead of Idea Cellular. More importantly, as the merger is restricted to the wireless business, it opens up options for RCom. It can now look for a strategic investor for its tower and infrastructure businesses.<

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