This means that only about 1.4 million Loop subscribers regularly use the network to make calls or download websites.
As part of the deal, Bharti Airtel will also get control of around 400 telecom towers, optic fibre connecting the towers, and electronic equipment on which Loop's network currently runs.
Bharti Airtel has also bought 5Mhz of the total 8Mhz of 900 Mhz band spectrum that Loop had in Mumbai, during the February auctions, removing any regulatory uncertainty over transfer of spectrum. Moreover, the transaction conforms to the new M&A rules that limit the market share of a merged entity in a circle to 50%, with a spectrum holding limit in a circle as well.
Analysts added that with mobile operators fighting for lucrative data customers in metro circles, the deal is positive for Bharti Airtel as about a third of Loop customers are highly valued post-paid subscribers, who generate higher revenues than the pre-paid ones that dominate India's telecom user base. Bharti Airtel Airtel is already the leader in Delhi. The deal will be the first since Idea Cellular picked up a majority stake in Spice in 2008.
“The proposed transaction will bring together Loop Mobile’s 2G/EDGE enabled network supported by 2,500 plus cell sites, and Airtel’s 2G and 3G network supported by over 4,000 cell sites across Mumbai. It will offer subscribers the widest exclusive retail reach with 220 outlets that will enable best-in-class customer service,” Bharti Airtel said.