The shareholders of Idea Cellular passed the two special resolutions for change in the name of the company to ‘Vodafone Idea Ltd’ and issuance of up to Rs 15,000 crore of non-convertible securities with requisite majority, at the company’s extraordinary general meeting held on Tuesday in Gujarat’s Gandhinagar. However, the company’s merger with Vodafone is still to be approved by the department of telecommunications.
Idea Cellular had informed the stock exchanges on June 1 that the company will be seeking shareholders permission for change of name of the company and the fund raise during a period of one year from the date of passing of the resolution.
The company had also said that upon issuance of the fresh certificate of incorporation by the Registrar of Companies consequent upon change of name, the old name ‘Idea Cellular Limited’ as appearing in the name clause of the memorandum of association of the company and the articles of association of the company, and other documents and places, be substituted with the new name ‘Vodafone Idea Limited’.
In March this year, Idea and Vodafone announced Balesh Sharma, the chief operating officer at Vodafone India, as the new chief executive officer who would be responsible for the combined business strategy, its execution and driving integration.
Once the merger of Vodafone India and Idea Cellular is approved by the DoT, the combined entity will have a total revenues at over Rs 80,000 crore, 400 million customers, 35% subscriber market share and 41% revenue market share.
The approval to the merger by the DoT is getting delayed as the latter is planning to raise a demand of around Rs 4,700 crore as one time spectrum charges (OTSC) on Vodafone India. The demand will be be raised under the merger and acquisition guidelines and need to be cleared before granting approval to the merger between the two companies.
The DoT is likely to ask Vodafone to either clear the dues or pay a bank guarantee towards it. The DoT is likely to raise a separate demand towards OTSC from Idea Cellular amounting to around Rs 2,000 crore. – Financial Express