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Jio to acquire some of Bharti Airtel’s spectrum resources for Rs 1,497 crore

New Delhi: In the first such deal between telecom rivals Reliance Jio and Bharti Airtel, an agreement has been signed under which the Mukesh Ambani-owned firm will acquire the ‘right to use’ some of Airtel’s spectrum resources in the Andhra Pradesh, Delhi, and Mumbai telecom circles.

According to a statement from the companies, the agreement will see Jio acquire a portion of spectrum in the 800 MHz band in these circles at an aggregate value of Rs 1,497 crore. Airtel will receive a consideration of Rs 1,037.6 crore from Jio for the proposed transfer, while Jio will also assume future liabilities of Rs 459 crore relating to the spectrum, Bharti Airtel’s statement said.

Jio added that it has now further strengthened its network capacity given the enhanced spectrum footprintespecially contiguous spectrum and superior infrastructure deployed. Post the trading agreement, Jio will have 2X15 MHz of spectrum in the 800 MHz band in the Mumbai circle and 2X10 MHz of spectrum in the 800 MHz band in the Andhra Pradesh and Delhi circles.

Lower bands such as the 800 MHz and 900 MHz are better at ensuring good indoor coverage while higher bands like 2300 MHz have a good carrying capacity, experts note. “The sale of the 800 MHz blocks in these three circles has enabled us to unlock value from the spectrum that was unutilised. This is aligned to our overall network strategy,” Gopal Vittal, MD and CEO (India and South Asia), Bharti Airtel said.

According to news agency reports, the spectrum sold by Airtel had found its way to the telco after the Tata Teleservices merger. The deal also comes after the recent spectrum auctions held in March, when winning bids worth Rs 77,800 crore were made for 855.6 MHz of spectrum.