Mumbai: Idea Cellular and Vodafone Group partnership is operational to create India’s largest telecom service provider with a subscriber base of over 408 million.
Vodafone is now being renamed as Vodafone Idea Limited and officials from the telcos have announced that both entities are to stay in the market.
A release from the firms stated that a new board of directors, comprising 12 members (including six independent directors), has been constituted, with Kumar Mangalam Birla as chairman.
On the occasion of the merger, chairman, Aditya Birla Group and Vodafone Idea Limited, Kumar Mangalam Birla, said, “Today, we have created India’s leading telecom operator. This is much more than just about creating a large business. It is about our vision of empowering and enabling a new India and meeting the aspirations of the youth of our country. The ‘Digital India’, as our Prime Minister describes it, is a monumental nation-building opportunity. As Vodafone Idea, we are partnering in this initiative by building a formidable company of international repute, scale and standards.”
Vodafone Idea will accelerate India’s progression towards a digital economy, enabling millions of citizens to connect to the digital revolution and build a better tomorrow. We will continue to offer a wide variety of digital services and solutions under both of our brands, he said.
With 1850 MHz of total spectrum holding, over 2 lakh unique GSM sites and 235,000 km of fibre, the merger claims that the companies offer superior voice and broadband connectivity across the country, covering 92 per cent of the population and reaching nearly 5 lakh towns and villages.
This extensive infrastructure will allow customers to remain confidently connected across the country and enjoy uninterrupted services even as it integrates and optimises its network in a phased manner across circles.
The company draws on support from its two largest shareholders – Vodafone Group Plc and Aditya Birla Group – to drive excellence and value creation from this merger.
FINANCIAL HIGHLIGHTS
* The merger is expected to generate Rs 140 billion annual synergy, including opex synergies of Rs 84 billion, equivalent to a net present value of approximately Rs 700 billion.
* The equity infusion of Rs 67.5 billion at Idea and Rs 86 billion at Vodafone coupled with monetisation of standalone towers of both companies for an enterprise value of Rs 78.5 billion, provides the company a strong cash balance of over Rs 193 billion post payout of Rs 39 billion to DoT.
* Additionally, the company has an option to monetise an 11.15 per cent stake in Indus, which would equate to a cash consideration of Rs 51 billion.
* As of 30 June, net debt was Rs 1,092 billion.
NUMBERSPEAK
* Subscriber base of over 408 million as of 18 June
* Over 2 lakh enterprise customers
* Over 3.4 lakh broadband sites with connectivity across the country
* Network outreach to 92% of population
* 1.7 million retail touchpoints
* 50,000 channel partners and 15,000 branded stores