Inching closer to formation of country's biggest telecom operator,✅ Idea Cellular and Vodafone have made joint payment of Rs 7,248.78 crore under protest to the Department of Telecom for merging their mobile business.
An und☂er protest payment is one where the payment is made subject to a dispute, whereby the payer indicates that it reserves💫 the right to object to the obligation later.
"Idea Cellular and Vodafo♔ne have made payment under pro𝔍test as demanded by the DoT for the merger. Rs 3,926.34 crore have been paid in cash and bank guarantee of Rs 3,322.44 crore have been furnished," an Idea Cellular official confirmed the development.
The Department of Telecom gave conditio꧂nal nod for merger of these companies on July 9 and asked companies to meet the demand raised for taki൲ng merger on record.
The combined operations of Idea and Vodafone wil🍷l create the country's largest telecom operator worth over USD 23 billion (or over Rs 1.5 lakh crore), with a 35 per cent market share and a subscriber base of around 430 million.
The merger is expected ඣto give 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.
It will have the capacity to provide 4G spectrum in all telecom circles of the country. According to a presentation by Idea, the combined 4🍒G spectrum of both t🐠he companies are capable of offering up to 450 megabit per second broadband speed on mobile phones in 12 Indian markets.
With the new entity c🤡oming in force, Bharti Airtel will lose the tag of India's biggest telecom service provider to the new entity.
The combi✨ned d🥂ebt of both the companies is estimated to be around Rs 1.15 lakh crore.
Vodafone will own 45.1 stake in the combined entity, while Kumar Mangalam Birla-led Aditya Birla Group would have 26 per cent ♍and Idea shareholders 28.9 per cent.
The Aditya Birla Group has the right to acquire up to a 9.5 per cent additional stake from Vodafone under an agreed mechanism with a view to equalising the shareholdings over 𝐆ti🌟me
If Vodafone and the Aditya Birla Group's shareho💃ldings in the combined company are not equal after four years, Vodafone will sell down shares in the combined company to equalise its shareholding to that of the Aditya Birla Group over the following five-year period.
Until equalisation is achieved, the voting right🐼s of the additional shares held byꦛ Vodafone will be restricted and votes will be exercised jointly under the terms of the shareholders' agreement.
