India’s prominent telecom operators, Vodafone and Idea form a merger

India’s prominent telecom operators, Vodafone and Idea form a merger

India’s prominent telecom operators, Vodafone and Idea form a merger

The Reliance Jio launch in the Indian market brought a tremendous turmoil among the other telecom operators in 2016. Set up by the India’s richest businessman, the company has built a broadband network costing over $20 billion.

Mukesh Ambani, the founder of Jio, has brought a massive change in the Indian telecom industry very promptly. This is because of the Jio offer followed by Happy New Year offer where in the company offered free calling and free internet to its users.

Looking at the scenario, it had become difficult for other businesses to survive. Vodafone in fact reported during the Jio launch offer as to who can compete with a company who is offering for free. However, the launch of the New Year offer has led the telecom industry to think and plan perfect actions.

The Voda Idea merger

To the same situation, Idea Cellular and Vodafone planned to merge and capture the largest market share. Let us find out more about their plans:

The jio offer has forced the operators to slash their prices and cut down their profits in order to survive in the market. Thus, Britain’s Vodafone group has permitted the merger of its Indian subsidiary with Idea Cellular. Vodafone is known to held stake of 45.1% giving the rest 4.9% to its affiliates and promoters.

Results

The combination of both is known to capture almost 35% of the total share market with over 400 million customers. To carry out their merger, Idea decided to find a presiding officer and Vodafone to get a chief financial officer. The merger news has shown better results immediately when the prices of Idea Cellular in the share market rose to 14.25%.

Final word

The customers get a huge benefit from the same while two major companies are merging to bring out something better. Customers can expect the best to happen with hoping the merger could again gain significant control in the market.

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