DoT may approve merger of Vodafone, Idea Cellular in the next few days

The department of telecommunications (DoT) is likely to approve the merger of Vodafone and Idea Cellular in the next few days, making the combined entity the country’s largest mobile services operator.

Sources said all the wings of the DoT as well as Telecom Secretary Aruna Sundararajan had given a go-ahead to the merger. After signature by Communications Minister Manoj Sinha, the approval document will be sent to the companies.

The sources further said neither company would have to pay big sums to the government as most dues, including licence fees and spectrum charges, were under litigation.

“Dues under judicial intervention cannot be sought by the government. Only the ongoing dues need to be paid by the companies at the time of merger,” a source in DoT said.

The source added that although one-time spectrum charges had also been stayed, Idea Cellular, the acquirer, would have to furnish a bank guarantee for this charge in accordance with the merger and acquisition guidelines. One-time spectrum charges for Idea Cellular stand in the range of Rs 20-25 billion. Idea is likely to contest the bank guarantee demand by the DoT. Ongoing dues, which include penalties and other minor charges, are just a few billion rupees, which will be paid at the time of merger.

Airtel, Telenor file joint application for merger approval before NCLT

Bharti Airtel and Telenor India today filed a joint application before National Company Law Tribunal for approval of their merger following nod from the market regulator SEBI and stock exchanges -- BSE and NSE.

"Telenor India and Airtel have today filed the joint company application before the New Delhi Bench of the National Company Law Tribunal for approval of the proposed Scheme of merger. The merger is inter alia subject to other statutory approvals including from the Competition Commission of India," Bharti Airtel said in a statement.

The company said that it has received the approval of the Securities and Exchange Board of India (SEBI), BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) for the proposed scheme of merger.

Airtel and Telenor signed the agreement for merger on February 2017 under which Airtel will acquire Telenor India's running operations in seven circles -- Andhra Pradesh, Bihar, Maharashtra, Gujarat, UP (East), UP (West) and Assam.

"These circles represent a high population concentration and therefore, offer a high potential for growth. The proposed acquisition will include transfer of all of Telenor India's assets and customers, further augmenting Airtel's overall customer base and network," the statement said.

It will also enable Airtel to further bolster its strong spectrum footprint in these seven circles, with the addition of 43.4 MHz spectrum in the 1800 MHz band -- widely known as 2G spectrum but it is now being used for 4G services as well.
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