NEW DELHI: Reliance Communications will merge its wireless telecom business with Aircel, resulting in an asset base of over Rs 65,000 crore. RCom will become the 4th biggest mobile phone operator in India, behind Airtel, Vodafone and Idea Cellular, following the merger.
However the company would require approvals from Sebi, Stock Exchanges, CCI, DoT and various courts, where Aircel is involved in legal wrangles. The company plans to get the approval in six months.
RCom and Aircel will hold 50 per cent each in the new company. The board of the new firm will have equal representation from the two sides. Aircel’s majority owner, Malaysia’s Maxis Communications Berhad (MCB), and RCom on Wednesday issued a joint statement that definitive documents for the merger of their Indian wireless businesses have been signed.
RCom has about 110 million customers (9.8% market share), while Aircel has 84 million subscribers (8.5% market share). Both will transfer Rs 14,000 crore of debt each to the joint venture, taking the total debt of the new company to Rs 28,000 crore.
The deal will help RCom cut its debt by Rs 20,000 crore. The New entity will hold 19.3 per cent of total spectrum - the highest in the sector.