Are Vodafone - Idea Cellular in 'exploratory' merger talks?
Vodafone India is in 'exploratory' talks with its domestic rival Idea Cellular, according to a CNBC TV18 report.
The shares of Idea Cellular surged over 6.72% to Rs 100.80 after the news. Nearly 94,600 shares have been exchanged on BSE index.
The BSE has sought clarification from Idea Cellular. The reply is awaited.
This move could help both the telecom service providers bring down Bharti Airtel from its throne as the market leader.
Bharti Airtel has nearly 25.22 crore subscribers in India, followed by Vodafone with 19.79 crore subscribers, and Idea Cellular taking the third spot with 17.46 crore subscribers, according to Trai data till April this year.
It is learnt that the two companies are assessing the possibilities of such a merger and challenges and opportunities it would bring. For one, such a deal may run into troubles with clearance from the Competition Commission of India, as a combined entity would breach 50% market share in a few circles, thus flouting anti-trust norms, a Moneycontrol report said.
Idea Cellular posted a net profit of Rs 220.4 crore for Q1FY17, a decline of 74% as against Rs 854.8 crore for the quarter ended on June 30, 2015.