Telecom firm Etisalat-Swan buys out Allianz Infratech

28 May 2009

Etisalat-Swan has bought out Allianz Infratech, making it possible for the telecom service provider to start operations in 15 of India's 22 telecom circles. The company also received approval from the Department of Telecom (DoT) for the deal.

In its communication to Etisalat, DoT said it was granting a 'no objection certificate' for the merger subject to both companies meeting all regulatory requirements. Etisalat-Swan will also get the 4.4 MHz of start-up radio frequencies that is held by Allianz in both the circles.

DoT has also asked Etisalat-Swan to submit a fresh proposal for the merger after the deal has been approved by the High Court or tribunal. 

UAE's Etisalat had, last year, picked up a 45 per cent stake in Swan for $900 million. Swan, promoted by Mumbai-based real estate and hospitality business group Dynamix Balwas Group, has licence for 13 circles.

Allianz, which had applied for a pan-India licence last year, was given permission to launch services in only two circles - Madhya Pradesh and Bihar where Swan does not operate.

Allianz Infratech failed to get pan-India telecom licence as its net worth was lower than the mandated Rs1,350 crore. It was later awarded licences for only two circles, allegedly out of turn.