Proximus to buy majority stake in India's Route Mobile

Belgian telecom provider Proximus will acquire a majority stake in Indian cloud specialist Route Mobile. Proximus said the deal would make it the third-largest player in cloud communications services in terms of message volume. 

Route Mobile's founding shareholders will join Proximus Opal, the Belgian group's holding company. Through Opal, Proximus will directly acquire 57.56 per cent of Route Mobile for 59.2 billion rupees or 643 million euros. 

The deal values the Indian company, which provides cloud-based communications services to businesses, at around 1.1 billion euros. It also triggers a mandatory takeover bid at the same price per share (1,626.4 rupees), which could increase Proximus' stake to 75 per cent.

"Some founding shareholders" will reinvest around 299.6 million euros in Proximus Opal, giving them a maximum 14.5 per cent stake.

Third-largest player

Proximus Opal already includes Telesign, Proximus' US subsidiary providing voice and data transmission to telecom operators worldwide. The deal values Telesign at 1.4 billion euros.

According to Proximus, the acquisition will lead to significant economies of scale and make the group the third-largest player in cloud communications services in terms of message volume. 

Proximus says it will increase its presence in Africa, Asia, Oceania and Latin America, while it already has a foothold in Europe and North America through Telesign.

Six to nine months

Route Mobile and Telesign will have combined annual revenues of 900 million euros, Proximus said. Route Mobile CEO Rajdip Gupta will remain in his current role and lead Proximus Group's cloud communications services. Joe Burton will continue as CEO of Telesign.

Proximus expects the deal, subject to regulatory approval, to be completed within six to nine months. 

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