Sunil Mittal-led Airtel may buy Ratan Tata's company again after 7 years; check details here

Bharti Airtel is reportedly close to acquiring Tata Play, which is India’s largest direct-to-home (DTH) operator. This move is strategic to Airtel and seeks to consolidate the company’s position in the digital television market that has been facing growth problems due to the emergence of the OTT platforms and FTA services. The aimed acquisition is believed to improve bundled services in Airtel and thereby increase non-mobile revenues through convergence.

This possible deal is a new achievement in the partnership between Bharti Airtel and the Tata Group after the previous partnership in 2017 when Airtel purchased Tata’s consumer mobility business. If implemented this may further strengthen Airtel’s strategy in the domain particularly in Indian market thereby enhancing its strategic goals.

Tata Play is one of the market leaders with about 20.77 million subscribers and a 32.7% market share it has been operating in the loss-making zone due to the change in the consumer preference pattern. These dynamics are seen in the case of the Tata Group which is planning to disengage from DTH services from content and entertainment space.

The acquisition of Tata Play will highly benefit Airtel in that it will enable the company to access more premium customers. This is considered as necessary to counter other players such as Jio, which has ramped up its services in the last couple of years. Besides, it would help Airtel add value to services like broadband and DTH, which would increase its customer base.

Details of the transaction have not been fully disclosed, but it is expected that Airtel will buy Tata Play at a similar multiple to a recent round of funding by Temasek Holdings that valued the company at USD 1 billion. The acquisition may also present Airtel with entry into further broaden broadband services via Tata Play Fibre.

In conclusion, this potential acquisition may well transform the competitive structure of the Indian DTH market, together with the associated consequences for increased concentration and intensified competition in both digital television and broadband markets.