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Mobile operators clear another big hurdle to forming joint venture serving 177 million customers.
Reliance Communications and Aircel cleared another important hurdle to their mobile merger this week, after the Competition Commission of India gave them the green light.
The approval comes less than a week after the deal was cleared by the Securities and Exchange Board of India (SEBI), the Bombay Stock Exchange (BSE), and the National Stock Exchange (NSE).
In a brief statement on Monday, RCom reiterated that it has applied for clearance from the National Company Law Tribunal (NCLT), Mumbai Bench.
Under the deal, agreed in September 2016, RCom’s mobile unit will be demerged from the rest of the business, which includes its fixed arm, enterprise division, and tower assets, and merged with Aircel.
Each operator will take a 50% stake in the venture, and have equal representation on the board.
The merger will create an operator with 177.4 million mobile customers, making it India’s fourth-largest player.
The RCom-Aircel tie-up is part of a wave of consolidation sweeping the country’s mobile market in the wake of Reliance Jio Infocomm’s launch of free nationwide 4G services in September last year. Jio is due to start charging for services from the beginning of April, but its pricing strategy promises to remain extremely disruptive.
On Monday, Vodafone announced it has agreed to form a $23.2 billion joint venture with Idea Cellular. The merged entity will serve nearly 400 million mobile customers.
Market leader Bharti Airtel has struck a deal to acquire Telenor’s Indian business that will strengthen its competitive position in seven key telecom circles.
Meanwhile, recent press reports allege that a merger between India’s state-owned operators, BSNL and MTNL, could be back on the cards.
