Idea shares up in early trade after FDI nod

INSUBCONTINENT EXCLUSIVE:
The shares of Idea Cellular gained nearly 2 per cent in early trade on Tuesday, outpacing a negative broad market, on back of Department of
Telecommunications (DoT) allowing 100 per cent foreign direct investment (FDI) in Idea Cellular
This decision will pave the way for merger of the carrier with Vodafone India, which will create India's No 1 telecom company by
customers and revenue market share, replacing Bharti Airtel. Shares of the company were trading 1.95 per cent up at Rs 90.80 on BSE at
around 10.15 am (IST). The approval is for total foreign investment of upto 100 per cent in Idea Cellular, up from the present level of 67.5
per cent, and total indirect FDI in its subsidiaries - Aditya Birla Telecom and Idea Cellular Infrastructure Services, the KM Birla owned
carrier said in a statement on Monday. "The FDI approval is a major milestone in the merger process of Vodafone India with Idea Cellular,
and follows other statutory approvals already received from the Sebi, NSE, BSE, CCI and NCLT Mumbai and NCLT Ahmedabad," the No 3 carrier
said. "The merger of Vodafone India with Idea Cellular is in the final leg of regulatory approvals and is expected to complete in first half
2018, subject to the final approval from the DoT," it added
The entity formed by the merger of Vodafone India into Idea will be called Vodafone Idea Ltd
and will remain listed
The combined company will have almost 42 per cent customer market share and 37 per cent revenue market share, the highest in a market where
rapid consolidation has left current No
1 player Bharti Airtel and moneyed new entrant Reliance Jio as its only rivals. ET had reported in its May 28 edition that the FDI clearance
for the carrier was expected within a week
Officials had said that the merger itself may be approved in a few days after the FDI clearance, and that Idea Cellular may have to give an
undertaking that the dues raised by the government would be paid by the company since it would be the license holder after licenses of
Vodafone get transferred to Idea, as part of the merger process.