Airtel in talks to acquire Tata Play

Sunil Mittal-led Bharti Airtel is in advanced talks to acquire Tata Play (DTH) service provider, according to reports. The move aims to enhance the telecom company's presence in the digital TV sector, which has experienced sluggish growth, while also supporting its bundled services to boost non-mobile revenues. 

The acquisition would mark the Tata Group’s exit from the content and entertainment space, following its earlier divestment of its consumer mobility business to the company in 2017, under the leadership of Tata Sons Chairman N Chandrasekaran. The DTH sector has been struggling with a shift in consumer preferences, as Tier-I and Tier-II users increasingly favour over-the-top (OTT) streaming services via home broadband, while rural users are opting for cost-effective alternatives like Doordarshan’s Free Dish.

Tata Play, formerly known as Tata Sky, has faced challenges in retaining market share amidst these changing industry trends. Insiders suggest that it aligns more closely with the teelecom company's strategy of offering bundled services to consumers. Tata Sons owns a 70 per cent stake in Tata Play, after acquiring Temasek Holdings Pte’s 10 per cent share in April for Rs 835 crore ($100 million), bringing the company’s valuation down to $1 billion from a pre-pandemic high of $3 billion. 

Walt Disney, which holds the remaining 30 per cent stake in Tata Play, is also considering exiting the TV distribution business as part of its strategic refocus following the 2019 merger with 21st Century Fox.Talks between Bharti Airtel and Tata Group have been ongoing for several weeks, with an official announcement expected soon. Tata Sons has not yet commented on the matter.