DoT Gives Final Nod to Idea Vodafone Merger

After a long time of going back and forth, the Department of Telecommunications has finally given its last and only needed approval for the Vodafone Idea merger. This final clearance by DoT has paved the way for Vodafone Idea Ltd, the largest telco in the country in terms of Revenue Market Share and subscribers. After this final nod from the department, the Vodafone India company will be dissolved, and the licenses along with the assets and liabilities of the company will shift to Idea Cellular. The new company will be called Vodafone Idea Ltd, as confirmed by Idea earlier.

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An official from DoT said about the development to ET as “Bank guarantees for deferred spectrum payments that Vodafone owes to a DoT will be amended by the banks concerned, and will be transferred to Idea Cellular, since that will be the entity that will hold the licenses.”

He further added, “The approval letter, however, includes the conditions that the merged entity will have to comply with the outcomes of pending cases in the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) and other courts.”

Reportedly, Idea Cellular and Vodafone had moved the court to contest the demand of bank guarantees from the telcos. However, the DoT has finally issued an affirmative to the merger on the conditions that both the companies will have to comply with the outcomes of the pending cases in court. The incorporation will render both the companies in a better position to tackle increasing competition in the country after a yearlong period of poor financials.