NCLT approves Idea's merger deal with Vodafone

Idea Gets NCLT Nod for Merger With Vodafone

Idea Gets NCLT Nod for Merger With Vodafone

The proposed merger of Idea Cellular and Vodafone India to create the company's largest telecom operator has moved closer to reality, with the companies receiving approval from the National Company Law Tribunal's (NCLT) Ahmedabad Bench.

"Considering the entire facts and circumstances of the case and on perusal of the Scheme and the proceedings, it appears that the requirements of the provisions of sections 230-232 of the Companies Act, 2013 are satisfied".

"The scheme is genuine, bona fide and in the interest of the creditors and the shareholders", said the Ahmedabad bench.

Idea shares erased losses and rose as much as 2.9% on BSE Sensex.

The Tribunal has approved consolidation of the telecommunications business and higher spectrum availability between the companies.

Last year, Vodafone and Idea, which are now India's No 2 and 3 telcos, had agreed to merge their operations to create the country's largest telecom operator worth more than $23 billion, with 35 per cent market share and 387 million users.

The two companies have already jumped all the other hurdles to reach a merger.

Vodafone is expected to hold around 47.5 percent stake in the merged entity and rest will be owned by Idea and promoter Aditya Birla Group.

Securities and Exchange Board of India (SEBI) gave its conditional approval to the merger previous year, subject to approval from shareholders and NCLT, which have now been received.

Yesterday's decision means only the permission of the government's Department of Telecom is needed for the merger to be completed.