May 11: The telecom department has said that it would expedite the merger of Idea and Vodafone to make it fall in line with the time frame set by the companies. The department also assured the approval of Bharti-Telenor deal in under a month’s time.
This follows the recent decision of the apex court to keep the Government at arms bay over levying one-time spectrum charge prior to mergers and acquisitions. Supreme Court made it clear that government cannot insist telecom companies gearing up for mergers and acquisitions to pay one-time spectrum charge (OTSC) levied on them.
Telecom Secretary Aruna Sundararajan has been quoted as saying by news reports that there wasn’t any hurdle ahead for the Vodafone-Idea merger, adding that the merger should get done within the target date set by the companies. The entities had outlined June as the target timeframe for the completion of the merger.
The Telecom Secretary also said that the department would be working closer with both the companies to make sure that there are no more delays. “We are working very closely to ensure that no bottlenecks are created and we go through due diligence and expedite the clearances,” she said.
The Idea-Vodafone merger has also got the clearance from Securities and Exchange Board of India, Competition Commission of India, National Company Law Tribunal and the stock exchanges. What awaits next for the merger is the clearance from Department of Industrial Policy and Promotion in relation to foreign direct investment apart from the final approval from DoT.
Regarding SC’s rejection of the plea over OTSC, Sundararajan said a review petition won’t be filed by DoT. As a result, the M&A policy of the department regarding payment of bank guarantee in the case of OTSC matter being under litigation won’t apply in similar cases. Bharti Airtel was asked to pay Rs 1500 crore as bank guarantee, following which the Telecom Disputes Settlement and Appellate Tribunal quashed the demand of DoT. Similarly, DoT’s calculation translates to Rs 5712 crore from Vodafone and Idea.