Idea Cellular Ltd. on Monday said that the department of telecom has approved 100% FDI in the company giving way to the much talked about merger deal between Vodafone India and Idea Cellular. The merger plan is in the last stage of regulatory approval.
The statement by Idea Cellular said, "Idea Cellular Ltd. has received approval on its application to increase foreign direct investment limit in the company to 100 percent, from the current 67.5 percent, from the Department of Telecom today". The statement further specified that the department's clearance is for 100% foreign ownership or investment in Idea Cellular and total indirect foreign direct investment in other subsidiaries that include Idea Cellular Infrastructure Services Ltd. and Aditya Birla Telecom Ltd.
The FDI clearance comes as a big success for the merger transaction between Vodafone Indi and Idea Cellular. Meanwhile, other statutory approvals have also been received from other institutions including the likes of CCI, NCLT, BSE, NSE and SEBI.
Post the merger, the combined entity is proposed to be called 'Vodafone Idea Ltd' and will be the biggest telecom player in the country with a subscriber base of close to 430 million.
In the transaction, Vodafone would acquire 45.1% stake in the company while Aditya Birla Group and Idea shareholders will have 26% and 28.9% share, respectively.
The statement further added, "The merger of Vodafone India with Idea Cellular is in the final leg of regulatory approvals and is expected to complete in the first half of calendar year 2018, subject to the final approval from the DoT".