Welcome Guest Login | Register | Site Map | | Make TelecomTiger my homepage     
Telecom News
Enterprise |  Policy & Regulation |  Mobiles & Tabs |  Corporate |  VAS |  People Movement  |  Technology  |  LTE
Enterprise
Vodafone Idea Board approves merger of Aditya Birla Telecom Ltd.
TT Correspondent |  |  18 Sep 2018

The board of Vodafone Idea Ltd. (VIL) has approved the merger of its unit Aditya Birla Telecom Ltd. (ABTL) with itself, moving a step closer towards monetizing the company's 11.15% stake in Indus Towers to pare debt.

In a statement to the stock exchanges on Monday, Vodafone Idea said, “the move would strengthen the financial position and ability" of VIL by "raising resources against the assets" owned by VIL such as mutual funds, Indus Towers Ltd. etc, including monetisation of such assets".

Idea Cellular’s stock ended 2.7% higher at Rs 47.65 on the BSE on Monday, outperforming a weak broader market. The announcement came after market hours.

British telecom giant Vodafone’s India subsidiary and the Aditya Birla Group company Idea Cellular last month merged to form the country’s largest telecom operator, Vodafone Idea Ltd. The merger between the giants was catalyzed by the onslaught of tariff war launched by Reliance Jio Infocomm which has already garnered over 20% revenue market share in just two years of launching its services.

As per an agreement between Indus shareholders, VIL can raise Rs 5,100 crore in cash from the sale of Idea Cellular’s 11.15% stake in the telecom tower company, which is a three-way venture between Idea, Vodafone and Bharti Airtel. Idea owns its stake in Indus through ABTL.

Separately, Indus is itself merging with Bharti Infratel, a unit of Bharti Airtel.

The new entity already has a debt of more than Rs 1.09 lakh crore and is expected to use the funds to pare its debt.

The notice to the stock exchange further said that the move to merge the ABTL would lead to simplification of the corporate structure, efficient and economical management and control over the running of businesses of the subsidiaries and in creating better synergies across the group.

The filing said ABTL recorded a revenue of Rs 3.7 crore for the financial year 2017-18 while VIL (formerly Idea Cellular) registered around Rs27,829 crore for the same period.

While ABTL had a net worth of Rs 6,189 crore, VIL had a net worth of Rs 25,670 crore as of March 31, 2018.

In a separate filing on Monday, VIL also informed BSE that Tarjani Vakil, an independent director on the company’s board had resigned, citing personal reasons. Instead, Neena Gupta was appointed as independent director on the company’s board for a period of three years.

    
 mail this article    print this article    Show and Post comment
18 Sep 2018(IST)  
Whitepaper
Maintain Business Continuity with Cisco ASR 9000 nV Technology
It is a virtual chassis solution where a pair of ASR 9000 routers acts as a single device by maintaining a single contr...read more
Simplify Your Network with Cisco ASR 9000 nV Technology
With the new Cisco Network Virtualization (nV) technology in the Cisco ASR 9000 Series Aggregation Services Routers, se...read more
Cisco Small Cell Solution: Reduce Costs, Improve Coverage
It is designed to address the challenge of mobile service coverage and to expand network capacity...read more
Other Stories of the Day