The much talked about and long awaited Vodafone-Idea merger has finally received the final approval from the Department of Telecom (DoT) – leading Vodafone India and Idea Cellular towards a mega merger to form the largest telecom service provider in India.
Post Jio era, a lot has changed in the Indian telecommunication market and perhaps, the biggest effect can be called to be the merger between two of the top three largest telecom service providers in India – Vodafone India and Idea Cellular. After months of processing, the Vodafone-Idea merger talks are about to conclude as the Department of Telecom (DoT) of India has given out the final approval to make the merger a reality. The DoT approval came after Vodafone and Idea jointly paid Rs 7,268.78 crore ‘under protest’ to the government for fast tracking the procedures.
Now that the two telcos have received the final nod from government, they will approach Registrar of Companies (RoC) for stipulated filings for approval and complete the final leg of formalities. Once done, the merger will be formally acclaimed and a new business identity with name Vodafone Idea will be formed. With a worth of over $23 billion (or over Rs 1.5 lakh crore)and a massive 35% market share with 438.8 million subscribers, Vodafone Idea will become India’s largest telecommunication company, beating even Mukesh Ambani’s Reliance Jio Infocomm Ltd. and current market leader Bharti Airtel Ltd.
Vodafone will own a 45.1% stake in the combined entity, while Aditya Birla Group will have 26% and Idea shareholders will hold 28.9%. After merger, Vodafone India’s current COO Balesh Sharma will be titled the CEO and Kumar Mangalam Birla, chairman of Aditya Birla Group, will be the non-executive chairman of Vodafone Idea. The merger will help both companies to bounce back with double the strength and the merger is expected to spark a new price war in the already extremely competitive telecom market of India – a win-win for customers.