Tata Teleservices (TTSL) is in talks with Matrix Cellular Services to pick up a majority stake in the privately-held telecom company. TTSL expressed their plans of buying the company over a period of three years. They plan on initially picking around 15% in Matrix and eventually increase the stake by 75% in the third year.

tata_communication_logoWith presence in 30 foreign countries Matrix offers cost-effective post-paid cards to Indian travellers. An Indian traveling to the US shells out Rs 75 / minute for an incoming call and Rs 175 / minute for outgoing. But Matrix offers Rs 30 for outgoing and Rs 15 for incoming calls. The company does not own infrastructure or spectrum; in fact it buys purchases bulk airtime through agreements with operators in varied countries. In the ned they sell the same airtime (minutes of traffic) to customers. With revenues of Rs 150 crore in FY09 the company is aiming a 35-40% increase.

It is a win-win situation for TTSL, simply because:
- Matrix products would perfectly fit TTSL’s CDMA subscriber base
- It would help TSSL offer lower call rates to subscribers going abroad
- It can offer matchless global roaming which is currently a deterrent under its CDMA platform

This move comes in after talks between Matrix and Essar Group’s retail arm The Mobile Store (TMS) have stalled. TMS proposed a merger with Matrix in a share swap deal.