Consolidation appears to be on the horizon in India’s telecoms market — the second largest in the world, with 12 operators serving 940 million mobile connections — as Bharti Airtel looks to expand its 4G footprint and smaller players enter merger talks.

India’s largest mobile operator Airtel is close to finalising a deal to acquire Augere Wireless Broadband for about INR1.5 billion ($23.5 million) to help it broaden 4G coverage.

A source told the Economic Times that an Airtel deal is nearly complete, but regulatory issues need to be worked out.

Augere acquired 40MHz of 2.3GHz spectrum in the Madhya Pradesh-Chhattisgarh region in 2010 but has never launched 4G service and has been looking to sell the licence, the Times said. Augere is owned by France Telecom and a number of private-equity firms.

Airtel has 2.3GHz licences in just eight regions.

Meanwhile rival Reliance Jio Infocomm is preparing to finally launch 4G service next month. Jio Infocomm, which obtained a pan-India 2.3GHz licence five years ago when it acquired Infotel Broadband, is expected to launch 4G service in five cities by June.

Jio Infocomm has 20MHz of 2.3GHz spectrum in 22 regions and 5-7MHz of 1.8GHz airwaves in 14 circles.

Sistema
After reports that Reliance Communications (RCom) is interested in buying Sistema Shyam Teleservices (SSTL), the Russian billionaire owner of Sistema said he has no plans to sell its India business, a small player with nearly nine million connections and almost a 1 per cent market share.

The head of Sistema, Vladimir Yevtushenkov, held talks with RCom CEO Anil Ambani about a possible joint venture in India, the Times said.

That news comes less than two weeks after Telenor’s Indian unit, Uninor, reportedly held discussions to acquire a majority stake in smaller rival Videocon Telecom for as much as INR100 billion ($1.56 billion).

Uninor has less than a 5 per cent share of the market with about 45 million mobile connections, and Videocon has just seven million connections, according to GSMA Intelligence.

The country’s four largest operators — Airtel, Idea Cellular, Vodafone and RCom – have a total market share of 70 per cent, while the five smallest players have a combined share of only 7 per cent.