New Delhi: Reliance Communications (RCom) has said it is open to new acquisitions and will explore consolidation opportunities in the telecom market, which is expected to see hectic M&A activity.
“Product life-cycle and upgrade-cycle has been reduced drastically since several firms are coming out with new types of products and services within a short span of time,” RCom has said in its annual report.
“As a result, hectic merger and acquisition (M&A) activities to consolidate the market share would be the new buzz in the market place. We are open to new acquisitions and opportunities to consolidate,” the company added.
The government is expected to come out with detailed M&A norms in September.
RCom is the only pan-India telecom company with complete Indian ownership. It had favoured the government's move to allow 100 per cent foreign direct investment in the sector.
It said consolidation in the sector has started taking place, following the cancellation of 122 telecom licences last year by the Supreme Court in the 2G spectrum allocation case.
“In quite a few circles, the numbers of operators has reduced from the earlier 10-12 down to 8-9 operators after the exit. This has resulted in reduced competitive intensity and lessening of downward pressure on tariffs,” RCom said.
Taking the benefit of reduction in competition and due to rising inflation, the company increased call rates of its pre- paid services by 25 per cent but reduced charges for post paid customers during financial year 2012-13.
The company had over 12.48 crore mobile customers on its network at the end of May.