Vodafone-Idea Cellular merger was completed on Friday marking the birth of the largest telecom operator in the country by subscribers and revenue. The final seal of approval from the NCLT came after the two telecom companies cleared their dues with the department of telecommunications (DoT) in July. The new entity would be a formidable rival to billionaire Mukesh Ambani’s Reliance Jio Infocomm, which has caused a widespread disruption in the country’s telecom industry.
“We wish to inform you that pursuant to filing of the NCLT orders with the relevant Registrars of Companies on 31st August, 2018,the Scheme has become effective on even date and the merger of VMSL and VIL with the Company has been completed. Consequently, the Board of Directors of the Company at its meeting held on 31st August, 2018, has taken the following actions pursuant to the merger of VMSL and VIL with the Company and implementation of the Scheme,” Idea Cellular said in the exchange filing.
The new telecom service provider will hold a revenue share of nearly 32.2 percent in the current market and combined customer base of nearly 400 million, placing it ahead of market leader Bharti Airtel.
Tight competition sparked consolidation in world’s number .2 mobile phone market, with Vodafone and Idea agreeing to merge their operations in India in a $23 billion deal last February. Twelve directors will be appointed on the board of the combined entity. While Kumar Mangalam Birla will serve in the capacity as chairman, Balesh Sharma will be the new chief executive officer (CEO). Himanshu Kapania who stepped down as managing director (MD) of Idea Cellular will continue to remain the non-executive director on the merged entity’s board.
Post this development, shares of Idea Cellular Ltd were up 2.9% at Rs 51.25 on BSE today. Idea shares have fallen 53.9% this year as of last close.