Global chipmaker also retains option to acquire 49% stake in partner
Firming its plans to foray into the Indian WiMax sector, global chipmaker Intel Corporation has signed a strategic alliance with Phi Group, an Indian angel partner firm. This makes Intel the first global major to foray into the Indian WiMax space, while others like IBM and AMD are expected to follow.
Under the alliance, formed through Intel Capital (its venture capital subsidiary), Intel has an option to acquire up to 49 per cent stake in the company. Phi Group, a firm started by four former Indian CEOs, helps global companies to set up operations in India.
WiMax or Worldwide Inter-operability for Microwave Access is a telecommunications technology that transmits data over various wireless networks.
“Intel and Phi Televentures (Phi Group’s subsidiary for ICE sector) have formed a special purpose vehicle to bid for WiMax spectrum. To begin with, the SPV will bid on behalf of the two state-owned telecom majors, Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL),” according to sources.
The SPV would work as a franchisee for the bidding and rolling out of WiMax services, he said.
When asked Intel Managing Director (South Asia & Middle East) C S Rao confirmed the development and said: “We have entered into a strategic alliance with Phi Group."
Rao, who is also President of WiMax Forum (India Chapter), confirmed that Intel would look at acquiring a stake in the company.
WiMax auctions are expected to take place simultaneously with 3G spectrum auction.
Phi Group is a start-up firm formed by four former Indian CEOs — Pramod Saxena (former CEO of Motorola and Essar Telecom), Ravi Sharma (ex-CEO of Alcatel-Lucent South Asia and Datacom Solutions), B D Khurana (former CEO of Reliance Infocomm) and Sanjiv Gupta (ex-CEO Coca-Cola). The angel partner firm has two subsidiaries, Phi Televentures for ICE sector and Phi Enterprises for non-telecom businesses.
Intel has made major investments in WiMax firms across the world. These include $43 million in Japanese UQ Communications, $600 million in US-based Clearwire and $11.5 million in Taiwanese carrier VMAX. Intel Capital has invested over $9 billion in 1,000 companies in 40 countries and is looking at investing in WiMax firms across the world.
