GTL’s parent Global Holdings Corporation and corporate data service provider Tulip Telecom may together invest Rs.300 crore for a 13% stake each in Qualcomm’s Indian BWA Venture.
Qualcomm is expected to set up a holding company in Asia which will own the remaining 74% in the new joint venture. Qualcomm may take in more partners subsequently as it is not really a service operator. Barclays Capital may have structured the deal which will be announced shortly.
Qualcomm recently won bandwidth to offer wireless broadband in four circles.
Transaction Reference: TOI
Global Holdings Corp is the holding company of the Global Group promoted by Manoj Tirodkar. GTL and GTL Infra are the other group companies. This will be Global Group’s first foray as a service provider.
Qualcomm has won 20 MHz of BWA spectrum in four circles i.e. Delhi, Mumbai, Haryana and Kerala for Rs. 4912.54 crore. Qualcomm is primarily a hardware provider and doesn’t have any service provider experience. Qualcomm is currently developing wireless broadband products based on Long Term Evolution (LTE) technology. This joint venture will allow Qualcomm to deploy its LTE products on a large scale. Its rival technology, Wimax, gives lower speeds but is comparatively mature and hence a more stable platform. This move will help Qualcomm demonstrate the superiority of LTE over Wimax and also help it win other customers in the Indian market. Qualcomm also expects that LTE’s popularity will help sell cell phones based on Qualcomm’s 3G/LTE chipsets.
Tulip Telecom is a Delhi-based data connectivity provider for corporates. It provides leased line and corporate internet connectivity to industries such as banking, IT and BPO. This will be Tulip’s first foray as a retail service provider.
The BWA story is the next battle in the telecom sector. Reliance Industries recently bought 95% stake in the Infotel Broadband Services which won spectrum in 22 circles across India. RIL had indicated that it will use Nokia’s LTE technology but there have also been reports that it may change over to Wimax because of LTE’s immaturity. RIL is expected to provide voice services on its BWA platform once the Government allows and is considering it a backdoor entry to the voice market. ADAG's RCOM also plans to roll out a Wimax network for BWA.
KVEZAR VIEW
| Date | Transaction | Type | Buyer | Size ($mn) |
| 28/07/10 |
Qualcomm's BWA Venture - Tulip Telecom, Global Holdings Corp |
M&A |
Global Holding Corporation Private Limited |
66.66 |
| Date | Type | Buyer | Target | Size ($mn) | State |
| 30/01/12 |
IPO / Offerings |
|
Micromax Informatics Limited |
- |
Called Off |
| 18/01/12 |
M&A |
Axiata Group Bhd (Earlier Telekom Malaysia Berhad) |
Tikona Digital Networks Private Limited |
- |
Planned |
| 13/12/11 |
M&A |
|
Viom Networks Limited (Formerly Wireless TT Info Services Limited) |
- |
Planned |
| 25/11/11 |
Private Equity |
Bharti Telecom Limited |
Bharti Airtel Limited |
10.46 |
Completed |
Company |
| Name | Promoters | Office | Competitor | Website |
| Tulip Telecom Limited |
HS Bedi |
C-160 Okhla Industrial Area,Phase 1,New Delhi-110020 |
SREI Infocomm Services Limited |
www.tulip.net |
 |
Barclays Capital |
