Good News For Customers: Vodafone – Idea Merger will not be Delayed

Summary Under 100 Words: As the Department of Telecommunication (DoT) did not accept the consideration of Idea and Vodafone’s demand of rethinking the estimate for dues, both telecom company has decided to pay the remaining amount to the DoT under protest. People associated with the matter are guessing that both Idea Cellular and Vodafone India might appeal to the Supreme Court to remove or at least pay less amount than asked by DoT. This move is expected to clear the current problems in the Vodafone-Idea merger process. Read the full article to know more.

Complete Article: Vodafone-Idea Merger not to be Delayed!

If you are unaware, Vodafone India and Idea Cellular decided last year that they will merge in order to counter the instability in the Indian telecom sector. The merging process was expected to complete by June 2018. However, the process is paused due to DoT’s demand of ₹7,268 crore from both companies.

The demand of DoT includes ₹3,342 crore from Idea cellular for one-time spectrum charges which will exist after the merger. For Vodafone, the amount is ₹3,926 crore (in cash) for holding non-auctioned airwaves. Both Idea and Vodafone are not interested to pay the amount. However, to speed up the merger process they have agreed to pay the due amount under protest.

I would like to draw your attention to the phrase ‘under protest‘. It means that they have agreed to pay the amount for now. However, the decision of DoT can be challenged in the Supreme Court. If they are able to win the legal battle DoT will have to return the whole amount to the telcos.

This will make the whole Vodafone-Idea merger process faster and it will be good both for both the telcos. In past, Airtel has faced a similar situation when they were asked to pay a hefty fee for their acquisition of Telenor India. However, under protest, the court stayed the charges by DoT.

After the merger process, the newly formed telecom operator will be called Vodafone Idea Limited. It will take over as the biggest telco in India surpassing Bharti Airtel. Telecomtalk reports, after the merger, the company will be worth $23 billion and it will have around 430 million customers across the country. The merger is expected to be a blessing for both the telecom operators and its customers. The coming weeks will uncover more news regarding the matter.