Deal to create country’s fourth-largest mobile operator clears major hurdle.
Reliance Communications’ and Aircel’s bid to combine their mobile operations cleared a significant hurdle on Wednesday, when the Securities and Exchange Board of India (SEBI) cleared the deal.
The Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have also approved the deal.
In a brief statement, RCom said it has now applied for approval from the National Company Law Tribunal (NCLT), Mumbai Bench.
"The proposed transaction is subject to other necessary approvals," the telco said.
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, according to subscriber data published by the Telecom Regulatory Authority of India (TRAI) in February. Fourth spot is currently occupied by state-owned BSNL, which had 96.8 million users at the end of December last year.
The transaction will also help to ease the intense competitive pressure wrought by Reliance Jio Infocomm, which in September sparked another price war by offering free services until the end of this month.