The Department of Telecom (DoT) on July 26, 2018, gave the final approval to the merger of Vodafone India and Idea Cellular. The approval for Vodafone-Idea merger came days after Idea Cellular and Vodafone India jointly paid Rs. 7,268.78 crores ‘under protest’ to the DoT.
With this approval, both the entities will now approach Registrar of Companies (RoC) for stipulated filings for approval, completing the last leg of formalities. The merged identity will be known as ‘Vodafone Idea’ that will create India’s largest mobile-phone company. Kumar Mangalam Birla, Chairman of Aditya Birla Group, will be the Non-Executive Chairman of Vodafone Idea while Balesh Sharma, Chief Operating Officer of Vodafone India, will be the CEO.
Key Highlights of the Merger:-
1. Vodafone will hold 45.1 percent of the combined entity, Vodafone Idea.
2. Aditya Birla Group will have right to buy 9.5 percent stake in the new entity.
3. Idea promoters will hold 26.1 percent of the entity.
4. Idea will have the sole right to appoint the Chairman of the new company.
5. Vodafone will deconsolidate Vodafone India immediately.
6. On the other hand, the appointment of CEO and COO will require an approval of both the companies.
7. The entity or the combined entity will be jointly controlled by Aditya Birla Group and Vodafone.