Picture Courtesy : The Financial Express
With the combined debt of both Vodafone India and Idea Cellular companies estimated to be around Rs 1.15 lakh crore they both were looking forward to earn some relief. The Department of Telecommunications (DoT) , it seems according to various media reports have granted them this wish by giving a nod to their merger.
The merger of Vodafone India and Idea Cellular that will create the country’s largest mobile services operator, an official source said. “DoT has cleared the Vodafone-Idea merger . They will have to meet conditions for final approval,” the source said .
The merger therefore is expected to give a breather to both debt-ridden firms Idea and Vodafone, from cut-throat competition in the market where margins have hit rock bottom with free voice calls.
The combined operations of Idea and Vodafone will create the country’s largest telecom operator worth over $23 billion (or over Rs 1.5 lakh crore), with a 35 percent market share and a subscriber base of around 430 million.
The department has asked Idea Cellular to pay Rs 3,926 crore in cash for Vodafone spectrum and furnish a bank guarantee of Rs 3,342 crore, the source further said.
