The mega-merger of Vodafone and Idea Cellular has got the final approval from the government today, according to PTI. The merged entity will be the country’s largest mobile operator with 35 per cent market share and around 430 million subscribers. Idea Cellular and Vodafone India a few days ago made a joint payment of Rs 7,268.78 crore ‘under protest’ to the Department of Telecom (DoT) for merging their mobile businesses.
A senior DoT official privy to the development told PTI that the final approval has been accorded to the merger today and the entities will now approach Registrar of Companies (RoC) for stipulated filings for approval, completing the last leg of formalities.
The conditional nod was given by the telecom regulator on July 9 and asked the two firms to meet the demand raised for taking the merger on record.
After the entry of Jio, the telecom industry has been badly bruised as it reduced the margins of the industry by offering very cheap tariff plans . The merger is expected to strengthen the two debt-stricken firms and will help them to face cut-throat competition in the market. The combined debt of both the companies is estimated to be around Rs 1.15 lakh crore.
The company had earlier announced that Kumar Mangalam Birla is proposed to be the non-executive chairman of the combined entity. Balesh Sharma is likely to be the new CEO. Akshaya Moondra, Idea’s chief financial officer, is expected to look after the financial operations of the new entity. Ambrish Jain will be the new chief operating officer of the combined entity.
According to a presentation by Idea, the combined 4G spectrum of both the companies are capable of offering up to 450 megabit per second broadband speed on mobile phones in 12 Indian markets.
Vodofone Idea will have to work hard to retain the number one slot as Bharti Airtel and Reliance Jio are expected to ace their game for number one position in the market.
(With PTI Inputs)