Vodafone to acquire YOU broadband for Rs 400 crore
Vodafone India has signed a pact to buy YOU Broadband for around Rs 400 crore and has sought approval from the Foreign Investment Promotion Board, said two people familiar with the transaction.
On January 16, ET reported that the two companies were in talks as part of Vodafone’s global effort to increase its cable or fixed line network.
TRG Capital-owned YOU Broadband India Ltd has around 3,000 km of optic fibre and 6,000 km of last-mile cables to homes across 12 cities, including Mumbai, a key data market for Vodafone.
The deal will increase Vodafone’s competitiveness in high data consuming cities in the backdrop of Reliance Jio Infocomm’ s plan to launch commercial 4G operations later this year.
Vodafone has observed the need to offload wireless traffic faster onto cables even in Europe, where it is tying up with AT&T to use a core network being laid afresh. Experts however say that in India a complete fibre connectivity for every tower isn’t viable commercially and in fact is not required for at least another four years.
YOU and Vodafone had been in talks for almost half a year, said a person quoted earlier. Vodafone declined to comment. A YOU spokesperson was unreachable for comment till press time. Rothschild and ICICI Securities were the investment banker to Vodafone and YOU Broadband, respectively.