Vodafone (LON:VOD) has moved a step closer to completing the merger of its unit in India with local provider Idea Cellular as the country’s antitrust regulator approved the tie-up. The news comes after the FTSE 100 group updated investors on its first-quarter performance last week, noting that competition in India remained ‘intense’.
Vodafone’s share price has been little changed in London this morning, having inched 0.13 percent lower to 222.00p as of 08:34 BST. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.64 percent higher at 7,424.87 points. The telco’s shares have lost more than five percent of their value over the past year, but have added some 11 percent in the year-to-date.
A lawyer representing Vodafone told Reuters yesterday that the Competition Commission of India (CCI) had approved the merger of the group’s Indian unit with Idea Cellular. The companies agreed the $23-billion tie-up deal earlier this year, creating the country’s biggest telecom player, after the entry of new entrant Reliance Jio sparked a price war.
The newswire quoted Shweta Shroff Chopra, a partner at Shardul Amarchand Mangaldas, which is representing Vodafone, as saying that the CCI approval was a very welcome development for both the Indian M&A landscape and the telecom sector, and will serve to fuel more investment into the telecom sector in India. A separate source told Reuters earlier that the deal had been approved by the CCI.
Vodafone has said that the transaction is expected to close during calendar year 2018, subject to customary approvals.
The update follows the FTSE 100 group’s results last week when Vodafone posted a rise in quarterly revenue. In India, the group’s performance was stabilising quarter-on-quarter although competition remained ‘intense’.