Shares of Idea Cellular turned volatile after the company said its board has approved the scheme of amalgamation of Vodafone India and its wholly owned subsidiary Vodafone Mobile Services with the company.
The stock rallied 15 percent to Rs 124 in the early trade only to settle the trade 10 percent down at Rs 97 on the NSE.
Since January 27, 2017, Idea Cellular has zoomed 44 percent after Vodafone reportedly confirmed that it is in merger talks with Idea Cellular. The stock trading close to its 52-week high of Rs 128 touched on April 28, 2016 in intra-day trade..
Meanwhile, other telecom stocks like Bharti Airtel, Reliance Communications and Reliance Industries ended flat on the BSE.
Idea Cellular said Vodafone to own 45.1 percent of combined company after transferring a stake of around 4.9 percent to Idea promoters for Rs 3,874 crore in cash concurrent with the completion of the amalgamation.
The Aditya Birla Group, promoters of Idea Cellular, will then owns 26 percent and has the right to acquire more shares from Vodafone under an agreed mechanism with a view to equalising the shareholdings over time, it added.
“This landmark combination will enable the Aditya Birla Group to create high quality digital infrastructure that will transition the Indian population towards a digital lifestyle and make the Government’s Digital India vision a reality,” said Aditya Birla Group Chairman, Kumar Mangalam Birla.
The transaction is expected to close during calendar year 2018, subject to customary approvals. – Business Standard