Idea Cellular, Vodafone India To Merge

By Shakir Husain NEW DELHI, March 21 (Bernama) -- Indian telecom services provider, Idea Cellular, 20 per cent owned by Malaysia's Axiata Group Bhd, has approved its merger with Vodafone India in a move that will create the country's biggest mobile network. The board of directors of Idea Cellular, majority-owned by Aditya Birla Group, approved the "scheme of amalgamation of Vodafone India Ltd (VIL) and its wholly-owned subsidiary, Vodafone Mobile Services Ltd (VMSL), with the company", according to a regulatory filing on Monday. "The implied enterprise value is Rs828 billion (US$12.4 billion) for Vodafone India and Rs722 billion (US$10.8 billion) for Idea," the statement said. The combined entity would have 394 million million customers or 35 per cent market share in the increasingly competitive Indian market. Competition has grown with the three biggest operators, Bharti Airtel, Vodafone and Idea facing price pressure following last year's launch of 4G mobile services by India's richest man, Mukesh Ambani's Reliance Jio Infocomm. At end-2016, Vodafone had a market share of 18.16 per cent with 204.68 million mobile customers and Idea had 190.51 million customers, controlling 16.9 per cent of the market. Market leader, Bharti Airtel, enjoyed a share of 23.58 per cent with a customer base of 265.85 million. The Vodafone-Idea deal does not include Vodafone's 42 per cent share in Indus Towers in which Airtel and Idea also have stakes. "Upon the amalgamation becoming effective, the entire business of VIL and VMSL, excluding VIL's investment in Indus Towers Ltd, its international network assets and information technology platforms, will vest in the company," the statement said. Vodafone will own 45.1 per cent of the combined entity after transferring 4.9 per cent shares to the Aditya Birla group while Idea will hold 26 per cent of the group and the remainder will be owned by other shareholders. --BERNAMA