The Department of Telecommunications (DoT) is all set to approve the merger between Vodafone India and Idea Cellular within the next few days. The DoT’s approval will see the closing of the largest mergers and acquisitions deal in the Indian telecom sector. The deal will bring together India’s second and third largest telecom companies, thereby creating India’s largest network.

Citing people privy to the matter, the
Economic Times
reported that Telecom minister Manoj Sinha has signed on the merger, and a final letter is likely to be issued today.

It was further reported that the DoT is expected to finalise conditions wherein Idea Cellular will have to submit a bank guarantee of Rs 2,100 crore as a one-time spectrum charge. According to the merger and acquisition rules, Idea will also have to seek an undertaking for paying dues from spectrum usage charge and license fee that is owed by both companies to the government.

After the merger is approved, the joint firm will be India’s largest telecom company. The combined entity will reportedly be worth $23 billion, with a 35 percent share in the market. That roughly translate to a base of 430 million subscribers. Of the combined entity, Vodafone is expected to own 45.1 percent, while Idea shareholders will acquire 28.9 percent. The Aditya Birla Group is expected to own 26 percent shares.

reported that Idea is expected to hold a meeting on June 26 to change its name to Vodafone Idea Ltd after the merger goes through. Kumar Mangalam Birla is likely to be named as the non-executive chairman of the combined entity, while Balesh Sharma will be the new CEO. Akshaya Moondra, Idea’s CFO, will possibly head the merged company’s financial operations. The current MD of Idea Cellular, Ambrish Jain, might be the new chief operating officer.

Here’s what happened
The merger between Vodafone India and Idea Cellular was announced on March 20, 2017. Since the announcement, both companies seemed upbeat about the merger and had anticipated its completion within 24 months of its announcement.

In 2017, both companies were confident that the merger would be completed before time. In a joint statement between the Aditya Birla Group and Vodafone Group, Kumar Mangalam Birla and Vittorio Colao said: “We welcome the decision of the Competition Commission of India approving the proposed merger of Vodafone India and Idea Cellular, following its comprehensive review of the transaction. It is expected that other statutory approvals will be forthcoming and we anticipate completing the transaction during 2018,”as per a

report. In July 2017, the Competition Commission of India cleared the merger.

Once again in December 2017, it was reported that the merger is likely to be completed in March or April – six months earlier than expected. After some back and forth, a
Financial Express
report from May 11, 2018, mentioned that the merger was on a fast track after receiving almost all clearances. The merger then was awaiting the clearance in foreign direct investment from the department of industrial policy and promotion.