Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: ACCOUNTING STANDARDS :: list of goods taxed at 4% :: due date for vat payment :: VAT Audit :: ACCOUNTING STANDARD :: TDS :: empanelment :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: articles on VAT and GST in India :: TAX RATES - GOODS TAXABLE @ 4% :: form 3cd :: Central Excise rule to resale the machines to a new company :: ARTICLES ON INPUT TAX CREDIT IN VAT :: cpt
Mergers and Acquisitions »
 Deals of the day-Mergers and acquisitions May 18, 2017,
 Forced mergers, sacking on cards as RBI gets tough with misfiring big banks
 Why India Inc is on an M&A spree, preferring inorganic growth to investing in fresh projects and capacities
 Banking consolidation 2nd wave: FinMin sees room for 3-4 more PSB mergers
 Ministry of Corporate Affairs (MCA) notifies the provisions of cross-border mergers and acquisitions
  GAVS Tech eyes to double revenue from mergers & acquisitions
 ACC, Ambuja Cements evaluating merger
 News Corp VCCircle Mergers & Acquisitions Summit 2017
 A new merger control philosophy
 IT deserves a strategic role in merger & acquisition integration
 Merger of Orient and IL&FS wind power businesses hits tax hurdle

DoT plans to relax merger and acquisition guidelines
March, 18th 2011

Kapil Sibal-led Department of Telecom is planning to relax merger and acquisition norms for the Indian telecom sector so significantly that it will leave only around six operators in any service area. At a recent conference organised by Goldman Sachs , the minister was heard saying each operator would have at least 10 MHz of spectrum, or radio airwaves, at its disposal, according to several industry participants who didn't want to be named. The DoT will release these proposals as part of the first phase of the New Telecom Policy 2011 consultation in April. A DoT official said, the Department was on schedule to release a progress report on the agenda Sibal had set out by the end of this month.

However, some members of the telecom industry are sceptical about how much of merger and acquisition norms' relaxation the government will be able to deliver. Sibal became Minister of Telecom under trying circumstances. In November, the then telecom minister , A Raja, was forced to resign on account of the 2G spectrum allocation scam. Raja is currently under arrest as the Central Bureau of Investigation is trying to establish the scale of the scam. Sibal was assigned the portfolio to implement change and ensure that regulations became fair, transparent and conducive for the telecom industry.

At the conference, Sibal also said that the DoT was working on a structure to ensure investments made by a company would be protected in case of an acquisition. While this is a positive for small or new operators like Uninor, Videocon's Datacom and Sistema Shyam , it is confusing for potential buyers. Large existing operators that include Bharti Airtel and Vodafone already have sufficient infrastructure, and would not be willing to reimburse companies with capital expenses as part of the acquisition. An analyst tracking the sector said, "It will make acquisitions too expensive, which is the case at present also."

In October, ET had reported that once norms are relaxed, Vodafone, NTT DoCoMo - through Tata Teleservices - and new international operators waiting for entry into the Indian telecom market were key potential acquirers. The telecom scam may have deterred new entrants, but the other two may still buyout smaller players for the sake of spectrum, an investment banker said. Earlier this year, Kumar Mangalam Birla, chairman of Aditya Birla group that owns Idea Cellular , had said that Idea may also turn into an acquirer in the long run, as it certainly isn't up for sale.

Stringent M&A restrictions had been imposed on the telcos a few years ago to prevent new players, who had got pan-India licences and spectrum at a flat fee of Rs 1,651 crore, from selling out at huge profits.

Last year, the telecom regulator issued a new set ofM&A guidelines that were criticised by some of the big telcos as these recommendations effectively shut them out of theconsolidation process. At the start of his tenure as telecom minister, Sibal set out a 100-day plan in which he said the government would come up with a New Telecom Policy. He said it would address 15 key issues, including spectrum fees, licence renewals, licence conditions and M&A norms. The Telecom Regulatory Authority of India recently published a recommendation to charge incumbent operators for airwaves over 6.2 MHz.

The recommendation drew dramatic opposition from telecom players. Attendees of the conference said Sibal assured he would not accept the fees proposed by the Trai but would discuss with industry leaders and arrive at a suitable price for the spectrum. Earlier Sibal also moved to cancel licences of certain operators who were reportedly given licences out of turn or did not meet network rollout conditions. The process is still on.

NBFC credit to tower cos classified as infra loan: Reserve Bank

Telecom towers firms will now be able to raise funds from non-banking finance companies or NBFCs with the RBI granting "infrastructure status" to loans extended by NBFCs to these companies. This will allow NBFCs that lend to tower companies to raise tax-free bonds, borrow from overseas through the external commercial route, raise long-term finance from banks and issue long-term debentures to insurance companies.

In a circular issued late Friday, the RBI has included 'telecom towers' also as an infrastructure facility for availing credit facilities. In telecom sector, earlier, loans given to service providers alone were treated as infrastructure loans.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Content Management System developers CMS developers Content Management Solutions CMS Solutions CMS India Content Management System India CMS development India Website CMS Website Content Management India Portal CMS India CMS Outsourcing CMS Vendor Complete CMS Custom CMS Services

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions