The boards of Aditya Birla Group and Vodafone Group have approved a merger between Idea Cellular and Vodafone India Ltd, in an attempt to create the company’s largest telecom operator.
The merged company will be the largest with about 387 million users in the country
At present, Vodafone India is the country’s second largest operator by users and Idea Cellular the third largest operator.
Vodafone India will own 45.1 % stake in the merged entity after transferring about 4.9 % to the promoters of Idea and their affiliates for Rs. 3,874 crore in cash, Idea said.
Promoters of Idea will hold 26 % stake in the company and the remaining will be held by the public.
On completion of the merger, the entire business of Vodafone India Ltd and its wholly-owned subsidiary Vodafone Mobile Services Ltd will be merged with Idea.
However, this excludes Vodafone India's investment in Indus Towers, and its international network assets and information technology platforms.
Promoters of Idea and Vodafone will have the right to nominate three directors each, while Idea Cellular will have the right to appoint the chairman. Promoters of idea will have the right to acquire up to 9.5 per cent additional stake from Vodafone.
The deal is subject to regulatory approvals
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