Idea Share­hold­ers Ap­prove Merger With Voda­fone

99% share­hold­ers vote in favour of the merger; cos await NCLT, DoT ap­proval

The Economic Times - - Companies & Economy - Our Bu­reau

New Delhi: Share­hold­ers of Idea Cel­lu­lar ap­proved the merger of the com­pany’s mo­bile busi­ness with In­dia’s No 2 car­rier Voda­fone, with al­most all of the votes go­ing in favour of the al­liance. The Aditya Birla group firm shared the de­tails with the stock ex­changes on Fri­day.

Idea Cel­lu­lar and Voda­fone In­dia have ap­proached the Na­tional Com­pany Law Tri­bunal (NCLT) for a nod, which had ear­lier or­dered the com­pa­nies to get share­holder ap­proval, be­fore the com­pa­nies go to the tele­com de­part­ment to get a fi­nal ap­proval to the merger.

Over 99% of Idea share­hold­ers voted in favour of the merger at the share­hold­ers' meet­ing on Oc­to­ber12, 2017, the fil­ing by the Aditya Birla group firm stated to­day.

Ear­lier this year, Voda­fone In­dia and Idea Cel­lu­lar had agreed to merge their op­er­a­tions to cre­ate the coun­try’s largest tele­com op­er­a­tor worth of more than $23 bil­lion and more than 400 mil­lion sub­scribers. The com­bined en­tity would have a rev­enue mar­ket share of 43% of the to­tal mar­ket, mak­ing it the largest car­rier by rev­enue and sub­scribers. The deal gives Voda­fone In­dia an im­plied en­ter­prise value of .₹ 82,800 crore and Idea .₹ 72,200 crore.

The com­bined en­tity of Voda­fone In­dia and Idea Cel­lu­lar would dis­lodge Bharti Air­tel to counter the fierce price war in the world's sec­ond-largest tele­com mar­ket. Air­tel an­nounced the merg­ing of Tata Te­le­ser­vices’ mo­bile busi­ness with it­self on Thurs­day, strength­en­ing its spec­trum holdings, which would help it give tough com­pe­ti­tion to both Jio and Voda-Idea.

Post com­ple­tion of the deal, the UK-based telco will own 45.1% stake in the merged en­tity while Idea's par­ent, will have 26% af­ter pay­ing .₹ 3,874 crore cash for a 4.9% stake. The re­main­ing 28.9% will be held by other share­hold­ers. Idea Cel­lu­lar’s shares in­creased 5.91% to .₹ 78.9 on the Bom­bay Stock Ex­change on Fri­day.

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