Idea soars 5.5% on buzz of merger with Vodafone in a month
PTI, the companies are likely to announce a signing agreement by February 24-25. Telecom major has brought its ex-India unit chief Marten Pieters to work on the merger. Shares of Idea Cellular were up over 5.5 percent intraday on Monday as investors placed positive bets on an escalation in the company’s merger plans with Vodafone. "The companies are likely to announce a definitive signing agreement by February 24-25," a source told news agency PTI. "They are almost ready to sign the agreement and should not take more than a month to announce it," another source told the agency. The British telecom major has brought its ex-India unit chief Marten Pieters to work on the proposed merger. Vodafone Group Chief Executive Vittorio Colao is also likely to brief all business heads of the Indian arm on a conference call this week about the proposed merger. If the deal is successful, the combined entity will create India's largest telecom firm with a revenue share of around 40 per cent and a subscriber base of over 380 million, according to India Ratings and Research
The proposed merger of Vodafone India and Idea will create an entity with a revenue of around Rs 77,500-80,000 crore besides eliminating duplication of spectrum and infrastructure capex, the rating agency said in its report. Further, the spectrum of Vodafone India in seven circles and that of Idea in two, whose permits are expiring in 2021-22, is together valued at around Rs 12,000 crore as per last auction price. These permits are not in common circles, and hence there could be potential spectrum capex synergies between the two companies, the report said. However, given the present spectrum holding, revenue and subscriber base, both the companies need to work on synergy to comply with rules. Based on the merger developments, the stock has gained a whopping 57.80 percent in the past one month. Idea Cellular was quoting at Rs 109.20, up Rs 3.20, or 3.02 percent on the BSE. It touched an intraday high of Rs 111.85 and an intraday low of Rs 108.90
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PTI, the companies are likely to announce a signing agreement by February 24-25. Telecom major has brought its ex-India unit chief Marten Pieters to work on the merger. Shares of Idea Cellular were up over 5.5 percent intraday on Monday as investors placed positive bets on an escalation in the company’s merger plans with Vodafone. "The companies are likely to announce a definitive signing agreement by February 24-25," a source told news agency PTI. "They are almost ready to sign the agreement and should not take more than a month to announce it," another source told the agency. The British telecom major has brought its ex-India unit chief Marten Pieters to work on the proposed merger. Vodafone Group Chief Executive Vittorio Colao is also likely to brief all business heads of the Indian arm on a conference call this week about the proposed merger. If the deal is successful, the combined entity will create India's largest telecom firm with a revenue share of around 40 per cent and a subscriber base of over 380 million, according to India Ratings and Research
The proposed merger of Vodafone India and Idea will create an entity with a revenue of around Rs 77,500-80,000 crore besides eliminating duplication of spectrum and infrastructure capex, the rating agency said in its report. Further, the spectrum of Vodafone India in seven circles and that of Idea in two, whose permits are expiring in 2021-22, is together valued at around Rs 12,000 crore as per last auction price. These permits are not in common circles, and hence there could be potential spectrum capex synergies between the two companies, the report said. However, given the present spectrum holding, revenue and subscriber base, both the companies need to work on synergy to comply with rules. Based on the merger developments, the stock has gained a whopping 57.80 percent in the past one month. Idea Cellular was quoting at Rs 109.20, up Rs 3.20, or 3.02 percent on the BSE. It touched an intraday high of Rs 111.85 and an intraday low of Rs 108.90
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