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Andrew Bonwick
Vice President of Product Development at Relm Insurance
Madhav Sheth
CEO of Ai+ Smartphone
Stephen Rose
CEO Render Networks
Idea Cellular has proposed for granting the company with 100% Foreign Direct Investment (FDI) to Department of Industrial Policy and Promotion (DIPP). This new information comes into the light after Idea Cellular and Vodafone India have announced their plans of merging into a single entity, which will emerge as India’s biggest telecom operator. After the announcement of this merger, both the companies have gone forward with the step and made significant progress both on and off paper for the same. The merged entity will be worth over 23 billion with 35% market share. The current news where Idea Cellular has requested for more FDI in the company has surfaced because presently foreign direct investment policy allows an overseas firm to buy up to 49% stake in an Indian telecommunication company under automatic approval route but specific government approval is required for claiming stake above 49%.
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According to the current scenario, shareholding in Idea stands at around 34%, including 7.49% in promoter group and the rest as public shareholders. Whereas British telecom multinational Vodafone remains as a majority shareholder in Vodafone India.
After the merger, Vodafone will own 45.1% of the combined company even after transferring a 4.9% stake to Aditya Birla Group for Rs 3,900 crore in cash.
A government official also added his words saying, “We have received the proposal from the Department of Telecommunications. As the department has added a condition in the proposal, the matter has been referred to the DIPP. It is under consideration of the department.” This news is reported by Press Trust of India.
