Reliance Communications’ (RCom) shareholders today approved the merger of its wireless division with Aircel.
RCom, in September last year, had announced it will merge its wireless telecom business with smaller rival Aircel to create the country’s fourth-biggest mobile phone operator.
“...pursuant to the order of the National Company Law Tribunal (NCLT), have today approved with 99.99 per cent majority for the Scheme of Arrangement for demerger of the Wireless division of the company and Reliance Telecom into Aircel Limited and Dishnet Wireless,” RCom said in a regulatory filing.
The merged entity will also have the second-largest spectrum holding (448 MHz across the 850, 900, 1800 and 2100 MHz bands) amongst all operators that will provide it with valid spectrum holding till 2033-36.
With an asset base of over Rs 65,000 crore ($10 billion) and net worth of Rs 35,000 crore ($5.38 billion), the merged company will be one of India’s largest private sector companies.
Post merger, RCom and the present shareholders of Aircel will hold 50% stake each in the merged entity.
Also, RCom’s overall debt including the deferred spectrum payment liability will be reduced by Rs 20,000 crore, while Aircel’s debt will reduce by Rs 4,000 crore upon completion of the transaction.
RCom has already received approval from the Securities and Exchange Board of India, BSE, NSE and Competition Commission of India for the proposal.