New Delhi: The merger proposal of Vodafone India and Idea Cellular, to create the country’s largest telecom company, is in the final stages of approval, telecom secretary Aruna Sundararajan said on Tuesday.
The two companies last week announced the top deck for the soon-to-be-merged entity, naming Balesh Sharma as the new chief executive officer (CEO). Asked about the status of the merger process that is awaiting the telecom department’s approval, Sundararajan said: “It is in final stages of approval."
The merger has already received the green signal from the National Company Law Tribunal (NCLT) as well as the Securities and Exchange Board of India (Sebi), she noted. “FDI approvals are involved and also liberalisation of licences... There are a number of clearances involved. We are in the process of expediting it," Sundararajan told reporters on the sidelines of a Cellular Operators’ Association of India (COAI) event on catalysing 5G launch in the country.
Vodafone and Idea, the second and the third largest operators in the country, recently announced the new leadership team of the merged entity that will have Kumar Mangalam Birla at the helm as the non-executive chairman.
The merger—slated to create India’s largest telecom operator in terms of customer base and revenue market share—is expected to be completed by June this year, subject to statutory approvals, the two companies had stated.
The combination, which is set to dislodge the numero uno player Bharti Airtel, was imminent as the incumbent operators have been bruised by aggressive tariffs from newcomer Reliance Jio, triggering a price war in the industry.
The merged entity is projected to be worth over $23 billion with a 35% market share. Sundararajan also said that the department of telecom is in the final stages of drafting the new National Telecom Policy 2018, and will thereafter place it before the Telecom Commission for approval.
“I cannot give a specific date...but we’re in the final stages of drafting the policy before we take it to the Telecom Commission. After that it will go to the government," she said.