NCLT-Ahmedabad Approves Idea Cellular and Vodafone India’s $23 Billion Merger Deal

By January 12th, 2018 AT 8:33 PM

The National Company Law Tribunal (NCLT)-Ahmedabad bench today approved the proposed merger of Idea Cellular and Vodafone India, meaning both the operators are now required to seek approval from Department of Telecommunications (DoT) once NCLT-Mumbai bench approves Vodafone’s merger request. The merger deal worth $23 billion was proposed back in March 2017 and is currently India’s largest M&A deal. Back at the time of announcing the merger, both the operators said that the deal would be completed in six quarters, but it is now expected to be completed much ahead of the expected time.

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“The scheme is genuine, bona fide and in the interest of the creditors and the shareholders,” said the NCLT Ahmedabad bench. Vodafone India is yet to receive approval from NCLT-Mumbai bench. Both the telecom operators have already received approvals from SEBI, shareholders, Competition Commission of India (CCI). As stated, if DoT approves the merger, both the telcos can merge the operations.

If DoT approves the $23 billion deal, the merged entity will become India’s largest telco with over 35% market share and an excess of 400 million customers. Idea shareholders have already approved the proposed merger.

As per the merger, Vodafone India will get an implied enterprise value of Rs 82,800 crores and Idea Rs 72,200 crores. After the merger, Vodafone India will have 45.1% stake, whereas Idea Cellular will have 26 percent after paying Rs 3,874 crore cash for a 4.9 percent stake. And the remaining 28.9% will be held by other shareholders. The merger will be completed by March 2018.

Recently, it was reported that both the operators had formed a project management office as the nodal body headed by former CEO of Vodafone Romania Ravinder Takkar. They have already started the exercise to shortlist senior executives that will play key roles in the merged entity.

Chakri is a go-to guy for your next smartphone recommendation. Back in his engineering days, he used to play with smartphones by installing custom ROMs and that passion got him into the tech industry. He still goes nuts about a smartphone knocking his door for review. Currently managing everything at Telecom Talk, Chakri is trying to master PUBG Mobile in his free time.

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NikhilTurinKaushikChetan MalhotraLalit K Recent comment authors
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Chetan Malhotra
Chetan Malhotra

I was reading somewhere an article about idea voda terms to be re thought following extreme capex crunch by both idea and voda following jio pricing war… It seems even after merger joint entity will cash starved. A huge capital infusion is required from promoters to run the show. Already capex towards network upgradation is LOW from both entity and laggered behind airtel. Customers are struggling because of same
I think the joint entity might be sold to either airtel or jio later

Arif
Arif

Currently Idea is only suitable for basic 2G voice communication in Bombay circle. 4G speed is worst. I think they lounched 4G for just name sake.

Lalit K
Lalit K

Compliant Three times for speed , still getting 2mbps on 4g idea mumbai,

+1

Nikhil
Nikhil

Use Vodafone/Jio in Mumbai!!!!!

Kaushik
Kaushik

Same situation with airtel. Only Vodafone and Jio are viable there.

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