The Tata group’s plan to merge its mobile telephony business with Bharti Airtel will help it save Rs7,000-8,000 crore, said group chief financial officer Saurabh Agarwal. In an interview, Agarwal explained the rationale behind the cash-free, debt-free deal and the criticality of exiting a hemorrhaging business. Edited excerpts:
Why has Tata Sons opted for this route instead of winding it down?
We chose to merge and it’s a huge cost saving as the closure cost for the size of this business is very large. We will end up saving Rs7,000 crore to Rs8,000 crore which is extremely important for us. Plus we get to keep our telecom tower stake which is also very critical.
From our perspective, a part of our spectrum goes away, our problems go away and our customers and employees find a new home and the whole system thrives.
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