Stating that the Idea Cellular seems to be the biggest winner of the Vodafone-Idea merger, Sanjay Kapoor, Ex Bharti Airtel CEO on Monday said that the merger has given Idea an opportunity to be a strong competitor in market.
Stating that the Idea Cellular seems to be the biggest winner of the Vodafone-Idea merger, Sanjay Kapoor, Ex Bharti Airtel CEO on Monday told ET Now that the merger has given Idea an opportunity to be a strong competitor in the market. He further said that the merger will also reduce debt and leverage for Vodafone’s global entity. Rahul Khullar, Ex Chairmain TRAI, too shared his views on the business news channel and said, “It looks like every party is a winner in Idea-Vodafone India merger on face value”. Cellular body COAI also termed the merger of Idea Cellular and Vodafone India as a “bold” move and said the combined stronger entity will be beneficial to both government and consumers of the Indian telecom market. “It is a bold move from both the operators… and signals their intention to be long-term players in India. From the government’s perspective, it will mean stability in terms of payments because it is a stronger entity that will emerge,” COAI Director General Rajan Mathews said.
British telecom major Vodafone and Aditya Birla group-run Idea Cellular today announced the merger of their operations, creating the largest mobile operator by customer and revenue market share. The merged entity, which will come into force over the next two years, will be headed by Kumar Mangalam Birla as Chairman. Vodafone will have its nominee as the chief financial officer, its CEO Vittorio Colao said.
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The all-share merger for both partners excludes Vodafone’s 42 per cent stake in Indus Towers and will be effected through issuing new shares in Idea to Vodafone and result in Vodafone deconsolidating Vodafone India. Vodafone will own 45.1 per cent in the new company after transferring 4.9 per cent to the Aditya Birla group for Rs 3,874 crore in cash concurrent with the completion of the merger. Idea will hold 26 per cent of the combined entity while the rest will be owned by public shareholders. Idea and Vodafone said the merged entity will be jointly controlled by Vodafone and the Aditya Birla group as per shareholders’ agreement.