Creating the countries largest telecom operator, Idea Cellular and Vodafone India on Monday announced a merger. The merger will create India’s largest telecom operator with widest network in the country and pan-India 3G/4G footprint, the companies said in a statement.
Vodafone will own 45 per cent of the combined entity and Idea and Vodafone will have the right to nominate 3 directors each. The deal excludes Vodafone’s 42 per cent stake in tower company Indus Towers. The combined entity will have 40 crore customers or nearly one in three customers in India.
Promoters of Idea will have the sole right to appoint chairman. The appointment of chief executive officer and chief operating officer need the approval of both the promoters.
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Bharti Airtel reported its lowest profit in four years in the October-December quarter while No. 3 player Idea Cellular posted its first-ever quarterly loss for the same period. Whereas, Reliance Communications has already entered into an agreement to merge its wireless business with rival Aircel.
Bharti Airtel had earlier this year announced an agreement to buy Norwegian company Telenor’s operations in six Indian states.