The second largest telecom provider in India, Bharti Airtel, is reportedly is reportedly planning to acquire one of the loss-making Tata Group companies. As per recent reports, the Sunil Mittal-led telecom company is in advanced negotiations with the Tata Group to buy loss-making Tata Play.
This is said to be an attempt of the company to consolidate its presence in the digital TV segment. The Tata Play is currently the largest direct-to-home (DTH) business in the country. Airtel aims to increase its non-mobile revenues through convergence by offering improved Airtel’s bundled offerings through digital TV segment.
If a sale happens, it will mark Tata’s departure from its sub-scale content and entertainment operations. It will also be the second time that the two business groups strike a deal, after Bharti bought out Tata’s bleeding and leveraged consumer mobility business in 2017 and absorbed it two years later. That was Tata Sons’ chairman N Chandrasekaran’s first divestment after taking charge of the group holding company.
Tier 1 and tier 2 users are upgrading to over-the-top (OTT) packs on home broadband instead of DTH and cutting the cord to migrate to cheaper online alternatives while rural subscribers are increasingly opting for Doordarshan’s Free Dish.
The talks, ongoing for weeks, have gathered momentum and a formal announcement is expected soon, said the people cited above. Tata Sons did not comment.
“The group had bet on the growth of Tata Play and seen strategic value in it until the dynamics of the market changed,” said an executive close to the development. “The group has been clear that in any market, it has to be in a position of strength and scale. That did not seem to happen as hoped with Tata Play. On the other hand, Tata Play fits well in the strategic plans of Airtel and its portfolio of offerings to consumers.”
