Vodafone India wins spectrum licences for Â£1.9bn
Vodafone's Indian division has won spectrum licences for £1.9 billion ($3.2 billion, 2.3 billion euros), the mobile phone giant said on Friday, tapping further into emerging markets amid tough trade in Europe.
Analysts described the move as "astute" for the London-listed company, which is flush with cash from the recent sale of its US joint-venture stake to partner Verizon for $130 billion.
"Vodafone India has been awarded spectrum licences in 11 telecom circles in the Indian government's 900 MHz and 1800 MHz spectrum auction," it announced in a brief statement.
In an Indian government auction on Thursday, the group acquired a total of 23MHz in the 900MHz band in Mumbai, Delhi and Kolkata and 49MHZ in the 1800MHz band in Mumbai, Delhi, Kolkata, Karnataka, Kerala, Gujarat, UP East, Rajasthan, Haryana, Andhra Pradesh and Punjab.
Vodafone India has over 160 million customers, with 45.7 million mobile internet users.
"This is further evidence of Vodafone expanding its horizons, and with a cash pile coming from its sale of Verizon Wireless in the maturing US market to the potentially huge and expanding Indian market," said analyst Mike McCudden at broker Interactive Investor.
"Strategically this is an astute and prospectively exciting move by Vodafone," he told AFP.
Vodafone has meanwhile proposed to buy out its minority partners in Vodafone India for about $1.6 billion and is currently awaiting approval from Indian authorities.
Markus Huber, analyst at brokerage Peregrine and Black, added that India -- the world's second most populous nation after China -- would remain a "major" growth market.
"India is a very interesting market what smartphones and mobile data is concerned," he said.
"Despite the economy in general there not doing that well at the moment, in the years ahead India should remain a major growth market.
"Considered the fierce competition in Europe it makes certainly sense to expand and invest in other markets like in India even if the new licences turned out a bit more expensive than originally expected.
"This needs to be seen as a medium to long-term investment and won't necessarily contribute to earnings in the near future (but will) help Vodafone to cement their position as one of the major mobile services provider in India."
© 2014 AFP