After Sebi, now CCI gives nod to RCom-Aircel merger
Reliance Communications (RCom) in a statement on Monday said that its Competition Commission of India (CCI) has approved its merger deal with Aircel.
RCom said, “The company has received an approval of the CCI for the proposed scheme of arrangement for demerger of wireless division of Rcom into Aircel Limited and Dishnet Wireless Limited (the scheme).”
The merger deal has already received approval from Securities and Exchange Board of India (Sebi) along with BSE and National Stock Exchange (NSE).
Now the proposal is with National Company Law Tribunal for approval.
On completion of demerger, Rcom and present shareholders of Aircel Limited will hold 50% each in Aircel.
In the month of September 2016, Anil Ambani's Rcom announced to transfer its wireless telecom business of Reliance Telecom (RTL) into Aircel and its subsidiaries.
Turnover of the wireless business undertaking of RTL as on March 2016, stood around Rs 10,605 crore, which is around 48% of the total turnover of RCom.
When the demerger was announced analysts believed that it is a key milestone in the ongoing consolidation in the telecom sector.
Tanu Sharma, Associate Director of India Ratings said, "The merger of the wireless business of RCom with Aircel is a key milestone in the ongoing consolidation in the telecom sector."
Sharma believes that the merger will enable the new entity RCom-Aircel to give strong competition to its peers in the backdrop of the disruption that the launch of operations by Reliance Jio (RJio) has caused.
This deal will enable RCom to access the superior 800MHz band in eight circles with extended validity till 2033, as its own spectrum is dated to expire in 2021-2022.
However, shares of Rcom were trading flat at Rs 38.20 per piece on BSE.