Updated: May 27, 2018
As Kumar Mangalam Birla who owns Idea Cellular said its Board has approved of a merger with Vodafone India and its wholly owned subsidiary Vodafone India Mobile Services, which will create India's largest mobile phone company with about 400 million customers, 35% customer market share and 41% revenue market share. Vodafone will own 45.1% in the combined entity after transferring 4.9% to the promoters of Idea Cellular for Rs 3,874 crore in cash post the merger. Kumar Mangalam Birla and other promoters of Idea Group will hold 26% and the rest will be owned by the public, said the statement. #Vodafone #Idea
As per the agreement, promoters of Idea have the right to acquire up to a 9.5% additional stake from Vodafone with a view to equalise shareholding overtime. If both Idea and Vodafone do not have equal shareholding by the end of the 4th year, after merger is completed, Vodafone will have to reduce its holding to equalise its ownership over the 5th year. Until the share equalisation is complete, additional shares held by Vodafone will be restricted and votes will be exercised jointly.
While the merger will result in creation of the largest telecom entity with pan-India 3G and 4G footprint, it will have sufficient spectrum to compete with major operators while offering attractively priced mobile services to consumers, specially in the wake of competition from Reliance Jio.
It would hold 1,850 MHz, including circa 1,645 MHz of liberalised spectrum acquired through auctions 7 . It will be capable of building substantial mobile data capacity, utilising the largest broadband spectrum portfolio with 34 3G carriers and 129 4G carriers across the country.
This is the Email that was Sent out by Sunil Sood, Managing Director and CEO of Vodafone India Ltd.
So What does this Mean?
Basically it could be a marketing promotion or they really want to satisfy their consumers in the Long Run by Providing many more services than their competitors. Which is a really smart move. #GoodJob