In a BSE filing, Idea Cellular said it constantly evaluates various opportunities to enhance stakeholders’ value.
“As part of the exercise, the company has been in preliminary discussions with Vodafone,” it said.
Idea emphasised that the fundamental premise of preliminary discussion is based on “equal rights” between Aditya Birla Group and Vodafone in the combined entity.
“In view of the fact that the discussion is at preliminary stage, the company is not in a position to share any further details… Further there is no certainty that the discussion with them will result in any agreement,” the company said.
Meanwhile, Vodafone sources said that the potential merger talk is all about remaining fully invested in the country and creating value through a larger enterprise.
The merger, if it goes through, would create a new leader in the Indian mobile and data industry challenging rivals Bharti Airtel and Jio and hence further intensifying competition.
“As per our analysis, a merger with Idea Cellular would be the best fit for Vodafone India, particularly as the two operators’ operational strengths are complementary. Moreover, Vodafone India’s potential merger with Idea Cellular would also pave the way for a backdoor listing of its business without going through an IPO process,” CLSA had said in its mid-January note on the potential mega merger.
The merger would help Vodafone India improve its positioning in the mass market while Idea Cellular would gain from Vodafone’s strength in metro circles, it had said.
“Not only would the combined entity become the industry leader but also a strong competitor in the data market with 3G spectrum across India and the highest 4G spectrum in the 1800 MHz band, enabling sufficient capacity spectrum,” CLSA had said.
(This article has not been edited by DNA’s editorial team and is auto-generated from an agency feed.)