The Central Government has approved the merger of two telecom giants-Vodafone India and Idea Cellular.
The merger will create the country’s largest mobile phone operator worth more than $23 billion with a 35 per cent market share.
The Department of Telecommunication has given its stamp of approval for the amalgamation after the two firms provided for Rs. 7,248.78 crore as one-time spectrum charge (OTSC), a senior government official told news agency PTI.
The Government is expecting that post this deal, the markets will stabilise.
The deal would surpass Bharti Airtel as combined customers of Vodafone-Idea will reach more than 430 million.
Idea Cellular is part of the diversified Aditya Birla Group.
This deal was announced by both the companies last year so that the building competition from Mukesh Ambani’s Reliance Jio could be taken head on.
The Department of Telecom had asked the two companies to pay Rs. 3,926.34 crore in cash and furnish bank guarantees worth Rs. 3,342.44 crore. The approval follows the two entities’ recently complying with the DoT’s requirement “under protest”.
Kumar Mangalam Birla would be the non-executive Chairman and Balesh Sharma the new CEO of the merged entity, which would remain listed.o had said.