Vodafone to get new shine from Idea; merger on its last leg


MUMBAI: The team at Vodafone India is gung-ho about its merger with the Aditya Birla-owned Idea Cellular.

Consolidation between the networks is in its last leg with most of the approvals already through. “We are just awaiting approvals from National Company Law Tribunal (NCLT) and the Department of Telecommunications (DoT) and it should happen over the next few months,” says Vodafone India CEO Sunil Sood.

What the senior executive is quite keen on is building a new fighting-fit telco machine with the right imagery. Says Vodafone India COO Balesh Sharma: “We are very optimistic about the merger. We want to give Vodafone a new shine with this merger. All options are open in terms of branding. However, haven’t decided what our brand journey after the merger will be.”

While that may be true, with the two major behemoths coming together, they will have to deal with the strong messaging that each of these has been pushing out to customers. Vodafone is known for its ZooZoos while Idea rolled out its new tagline of ‘LookLook’ early this year. Vodafone will continue to push the characters of Asha and Bala for all its campaigns post the merger as well.

While Vodafone has a strong presence in urban areas, Idea has captured a significant chunk of interior India. Together they will surpass Bharti Airtel to become the largest telecommunication company with a combined subscriber base of over 400 million.

Idea Cellular, our own homegrown brand that was launched in 1995, has a subscriber base of 193.96 million as of July 2017 whereas Vodafone India is the Indian subsidiary of UK-based Vodafone Group, the world's second-largest mobile phone company. The network enjoys a subscriber base of 250 million and has a 20 per cent market share.

Under the terms of the deal, Vodafone will hold 45.1 per cent stake in the combined entity, the Aditya Birla Group will hold 26 per cent and the remaining shares will be held by the public. With this deal, Vodafone India would have a valuation of Rs 82,800 Crore and Idea at Rs 72,200 Crore.

In the ongoing battle for customer acquisitions, Vodafone and Airtel have revamped their tariffs to lure customers. With IoT being the new talk of the town, networks are fighting to seize Reliance Communication customers.

With the current telecom war between the giants – Vodafone, Airtel and Jio – it will be interesting to watch which one bites the bullet and which bites the dust.

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