A new board has been constituted for the merged entity “Vodafone Idea Ltd’ with 12 directors (including six independent directors) and Kumar Mangalam Birla as its Chairman. The board has appointed Balesh Sharma as the CEO, the companies said in a joint statement.
The combination will have all India revenue market share of 32.2 per cent and take the numero uno slot in nine telecom circles, it said adding that both Vodafone and Idea brands will continue. The telecom giant will topple Bharti Airtel from its current pole position, and will have the firepower to take on competition in the Indian telecom market, which has intensified with the aggressive entry of Reliance Jio.
It will have a broadband network of 3.4 lakh sites and distribution network with 17 lakh retail outlets.
“The merger is expected to generate Rs 14,000 crore annual synergy, including opex synergies of Rs 8,400 crore, equivalent to a net present value of approximately Rs 70,000 crore,” the statement said.
The combination will have a wide spectrum portfolio of about 1,850 MHz, over 2 lakh mobile sites and about 2.35 lakh kms of fibre. This will allow it to offer “superior voice and broadband connectivity across the country, covering 92 per cent of the population and reaching nearly 5,00,000 towns and villages,” it said.
Kumar Mangalam Birla, Chairman Aditya Birla Group and Vodafone Idea Limited said, “Today, we have created India’s leading telecom operator. It is truly a historic moment…As Vodafone Idea, we are partnering in this initiative by building a formidable company of international repute, scale and standards”.
Balesh Sharma, CEO of the new entity said, “We are committed to offer both our retail and enterprise customers an excellent experience while fulfilling their evolving digital and connectivity needs via new products, services and solutions”.
A regulatory filing by Idea said it will be renamed as Vodafone Idea Ltd, following the completion of all formalities and approvals. Post merger, the paid-up equity share capital of Idea Cellular stands increased to Rs 8,735.13 crore. Himanshu Kapania has stepped down from the position of Managing Director of Idea Cellular with effect from August 31, 2018, but shall serve as non-executive director of the new company.