Govt nods for telecom companies Vodafone- Idea merger

NewsBharati    12-Jul-2018
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New Delhi, July 12: Idea Cellular and Vodafone India can merge but the companies need to complete some formalities for the final closure of the deal said Telecom Minister Manoj Sinha on Wednesday.


 

“The Government has approved this merger,” he said. The combined operations of Idea and Vodafone will create the country's largest telecom operator worth over 1.5 lakh crore rupees, with a 35 percent market share and a subscriber base of around 430 million. Debt-ridden firms Idea and Vodafone India are in process of merging their businesses in India as it is expected to bring down the cost of their operations and give them relief from cut-throat competition in the market where margins have hit rock bottom with free voice calls.

"We would like to see that the merger is completed at the earliest because we too want the sector is stabilized. This is an important step for stabilizing the sector," Telecom Secretary Aruna Sundararajan said.

With the new entity coming in force, Bharti Airtel will lose the tag of India's biggest telecom service provider to the new entity. The combined debt of both the companies is estimated to be around Rs 1.15 lakh crore.

The two companies decided to merge their business after the sector witnessed a huge tariff war and reduction in margins with the entry of new telecom operator Reliance Jio.