New Delhi: Telecom minister Manoj Sinha said on Tuesday that the government will clear the long pending Idea-Vodafone merger immediately after the Department of Telecom (DoT) completes all statutory formalities.
Idea and Vodafone were expecting the merger deal, which will create the country’s largest telecom operator, to be completed by June 30, 2018.
It is estimated to have over 40 crore mobile customers from day 1 and 41 per cent revenue market share for the combined entity.
The merged entity is proposed to be named as Vodafone Idea Limited if approved by shareholders of Idea Cellular.
“DoT has set rules for merger and acquisition. Idea Vodafone merger will be cleared without a single second delay once DoT completes all statutory formalities,” said Mr Sinha.
According to reports, telecom department is considering to raise a fresh demand of around '4,700 crore from Vodafone before granting clearance, according to sources.
In 2015, Vodafone had merged its four subsidiaries Vodafone East, Vodafone South, Vodafone Cellular and Vodafone Digilink with Vodafone Mobile Services, which is now called Vodafone India.
The DoT at that time has asked Vodafone to clear OTSC dues worth '6,678 crore but the company challenged it in the court.
Following the Supreme Court order, Vodafone had paid only '2,000 crore to get the deal cleared. The DoT now wants Vodafone to clear pending amount before it is merged with Idea Cellular.
The demand will be in addition to bank guarantee of around '2,100 crore that DoT will seek from Idea for one-time spectrum charges dues.
Vodafone Group and existing promoters of Idea will hold 45.1 and 26 per cent of the equity share capital of the merged company, respectively, and the balance 28.9 per cent will be held by the public shareholders.
