Vodafone Idea on Tuesday said that the company along with Vodafone Group, Bharti Airtel, Indus Towers and Bharti Infratel have agreed to move ahead with completion of the merger between Indus and Infratel. The company in an exchange filing on Tuesday provided the update on the Bharti Infratel and Indus Tower merger. The development would result in Vodafone Idea selling its 11.15% stake in Indus Towers for approximately Rs 4000 crores translating to US$551 million. The merger was initially announced in April 2018 with the combined company emerging as the “largest tower company in the world outside China.”
Indus Towers and Bharti Infratel Merger Moves Ahead
However, Bharti Infratel had consistently extended the long-stop date for the merger with the company in late June announcing that the long-stop date had been extended to August 31, 2020.
Bharti Infratel in its exchange filing on Tuesday said that its board “decided to authorise the chairman to proceed” with the completion of the merger.
The company also highlighted that the Vodafone Group will hold 28.2% stake in the merged company while the current Infratel shareholders will hold 68.6% stake in the merged company.
It has to be noted that the Indus Towers is jointly owned by Bharti Infratel, Vodafone Idea and the UK based Vodafone Group. Bharti Infratel and Vodafone hold 42% stake each in the Indus Towers while Vodafone Idea group hold the 11.15% stake.
Indus Towers and Bharti Infratel Merger Subjected to NCLT Approval
It has been said that the merger is now subjected to the approval of the National Company Law Tribunal (NCLT).
“The Parties have agreed to take appropriate steps to progress the approvals for the merger, the completion of the merger shall be subject to receipt of all such approvals,” Vodafone Idea said in its exchange filing. “The merger scheme shall become effective on the date on which certified copy of the order of Hon’ble NCLT is filed with [the] Registrar of Companies.”
The Competition Commission of India (CCI) and the Stock Exchange had earlier approved the proposed merger between Bharti Infratel and Indus Towers.