25.6.08

Idea Cellular buys Spice Communications

Idea Cellular, India's fifth-largest mobile operator, said it would buy Spice Group's 40.8 per cent stake in another mobile firm, Spice Communications, at Rs 77.3 per share.Idea also said it would merge Spice with itself through a share swap where Spice shareholders would get 49 Idea shares for every 100 Spice shares held.Spice has operations in two out of a total 23 telecom circles and has a customer base of more than 4.4 million while Idea is present in 11 circles and has a customer base of over 26 million.
The total transaction value is Rs 2,720 crore.The deal value includes two components—equity value of Rs 2,176 crore at a price of Rs 77.30 per share as well as a payment of Rs 544 crore to the Spice Group as a non-compete fee.Idea & Telekom Malaysia will give an open offer for remaining stake with public at Rs 77.30 a share Telekom Malaysia will acquire 15% in Idea for Rs 7,295 cr .Post-merger, Telekom Malaysia’s holding in Idea will be 18 %– 20 % Post-merger Birla’s holding in Idea will be 46%–48%
India, the world's fastest-growing mobile services market and the second-largest market after China, has 269.30 million wireless users at end-April, up 57 percent from a year earlier, according to the telecoms regulator.

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