Airtel acquires 49% stake in Qualcomm’s 4G biz in India for $165 million [update]

News is trickling in that Airtel has acquired 49 percent stake in Qualcomm’s 4G network unit in India. There had been indications that Airtel and Qualcomm were in talks. Qualcomm has 4G spectrum in key circles of Delhi and Mumbai apart from Haryana and Kerala. This would be crucial for Airtel for its ambitions to be a pan-India 4G network operator. It already operates 4G networks in Kolkata and Bangalore and has spectrum in Karnataka, Maharashtra and Punjab. Read on.

Qualcomm paid about $1 billion for its BWA spectrum and had a JV with Tulip Telecom and Global Holding Corp, each holding about 13 percent each to comply with Indian laws. While details are scarce at the moment, we expect Airtel to have bought out the two Indian partners and some stake from Qualcomm. Eventually Qualcomm intends to exit the 4G operations space.
UPDATE: Bharti Airtel acquired the 49 percent stake for $165 million. This is a very low valuation for what Qualcomm initially paid indicating Qualcomm remained true to its stance of acquiring 4G spectrum in key circles just to ensure that carriers use its LTE technology. According to the press release, the agreement contemplates that once commercial operations are launched, subject to certain terms and conditions, Bharti would assume complete ownership and financial responsibility for the BWA entities by the end of 2014.