Our Bureau Idea Cellular, which is in the process of merging with Vodafone India, has received approval from the Department of Telecommunications (DoT) to increase its Foreign Direct Investment (FDI) to 100 per cent.
The approval is a major milestone in the merger process. This follows other statutory approvals received from SEBI, NSE, BSE, CCI and NCLT Mumbai and NCLT Ahmedabad, the Aditya Birla Group company said in a statement.
The approval is for total foreign investment up to 100 per cent in Idea Cellular, and total indirect FDI in its subsidiaries — Aditya Birla Telecom and Idea Cellular Infrastructure Services. Prior to the approval, the telecom operator’s FDI limit stood at 67.5 per cent, it added.
The merger of Vodafone India with Idea Cellular is in the final leg of regulatory approvals and is expected to be completed in the first half of this calendar year, subject DoT’s final approval.
Last Friday, Idea had proposed a new name for the combined entity — Vodafone Idea Ltd. It had also scheduled an extraordinary general meeting for June 26 to decide on the name change.
Idea, the country’s third largest telecom operator, is in the process of merging with Vodafone India, the second-largest player by subscribers. Following the merger, which will result in the creation of the country’s largest mobile operator by subscribers, Vodafone is expected to own 45.1 per cent in the combined entity, while 26 per cent will be held by the Aditya Birla Group and the remaining 28.9 per cent by Idea shareholders.
Ahead of the announcement, Idea shares ended up 1.78 per cent at ₹62.75 on a weak BSE, which ended down 0.61 per cent on Monday.