The Indian telecom industry has been experiencing unprecedented limelight since April due to floating reports of game-changing mergers & acquisitions in the sector. The global tech giants are the prime buyers, interested in investments by acquiring a multibillion-dollar stake in these top telecom companies of the developing nation with strong demand potential.
The stake acquisition in the Indian telecom companies started in April, with Facebook announcing an investment of $5.7 billion in the Reliance Industries Ltd’s telecom & digital platform- Jio. Reliance Jio is the largest telecom market player in the fastest growing economy due to its attractive 4G plans during launch in 2016. Facebook acquired a 9.9% stake via a new entity Jaadhu Holdings LLC, as per regulatory documents. This deal was followed by well-known private equity investors KKR & Co. and General Atlantic picking up the stake in the Jio Platform.
The buzz created by this high profile deal sparked the reports of other tech giants, such as Google and Amazon entering the investment spree in the Indian telecom sector. As per the sources, internet giant Google has initiated talks with Vodafone Idea Ltd. to acquire up to 5% stake in the entity to build a strong standing in one of the fastest-growing telecom industry. Due to cheap tariffs and tough competition from its rival, Jio, the merged entity of Vodafone India and Idea Cellular has been going through financial stress over the last few quarters. The deal with Google will be a respite for the company to a certain extent.
Another tech giant to recently join the buyout bandwagon is Jeff Bezos’s Amazon. As per reports, Amazon is in talks with Bharti Airtel to buy at least a $2 billion stake in India’s third-largest telecom operator. Amazon regards India as an important growing market, while planning to achieve control over the country’s digital industry.
The investments pouring in times of economic breakdown due to the pandemic situation caused by the Wuhan originated COVID-19 has offered a positive wave in the market for the future growth of the Indian economy. Besides, the tech giants are showing an ardent interest in the Indian market as the country is one of the fastest-growing economies with huge working and young population across the country.
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