Axiata, Holder of Idea Stake, Welcomes Merger Talks
Kolkata: Malaysia’s Axiata Group, a strategic shareholder in Idea Cellular, has welcomed the merger talks between the Kumar Birla-owned telco and UK’s Vodafone Group Plc in India. “Axiata welcomes and supports the consolidation of India’s telecoms market,” the Malaysian carrier said in an official statement on Tuesday. It said “there have been many discussions among industry players, especially recently on the state of the (Indian) telecom industry”. Axiata owns a 20% stake in Idea. Its comments came a day after Vodafone India and Idea said they were in preliminary discussions for a cashless deal to merge their operations.
Formerly Telekom Malaysia, Axiata, did not respond to ET’s specific queries on whether it would increase its stake in Idea proportionately to maintain a 20% ownership in the merged Idea-Vodafone entity, going forward.
According to recent news reports, Axiata was looking to sell its 20% stake in Idea Cellular as it expected the Indian telco’s valuation to remain subdued for at least the next three years due to likely price war stemming from Reliance Jio Infocomm’s entry into the sector last September.
Axiata forayed into India in 2006 with an investment in Spice Telecom. It subsequently backed Idea’s acquisition of the Punjab-based operator, paying just short of $2 billion in 2008 for its stake.
Formerly called Telekom Malaysia, Axiata holds 20% stake in Idea Cellular