Acquisition of Spice Communication by Idea Cellular

Topics: Aditya Birla Group, Kumar Mangalam Birla, Idea Cellular Pages: 3 (815 words) Published: March 25, 2009
Idea Cellular Buys 40.8% Stake in Spice Communication By: PTI | Jun 26, 2008 {draw:a} Email this {draw:a} Comments {draw:a} RSS {draw:a} Digg this {draw:a} Idea Cellular has announced acquisition of rival mobile operator Spice Communications in a deal entailing purchase of a 40.8 per cent stake for over Rs. 2,700 crore in shares and cash.

Besides, Idea will also make an open offer, along with Telekom Malaysia, to acquire a further 20 per cent stake in Spice for over Rs. 1,000 crore, while the Malaysian firm would be alloted over 46.4 crore Idea shares on preferential basis for about Rs. 7,300 crore.

Idea will also pay Rs. 543.97 crore as a non-compete fee to Mcorpglobal.

Idea, along with Telekom Malaysia and its subsidiaries as persons acting in concert (PACs), will also make an open offer for an additional 20 per cent stake in Spice.

Idea said that the merger of Spice with itself would be based on an exchange ratio of 49 Idea shares for every 100 shares of Spice, which would be subject to all regulatory approvals, including the Department of Telecommunications.

Idea Cellular to acquire Spice Communication Thursday, July 17, 2008 The company will also pay approximately Rs 544 crore to the Spice group as non-compete fee. Idea and Telekom Malaysia International along with their affiliates will make an open offer for an additional 20 percent stake in Spice. The open offer will be made at a price of Rs 77.30 per share. The boards of Idea and Spice have approved the merger of Spice into Idea. Spice shareholders will get 49 Idea shares for 100 shares in Spice. Idea will make a preferential allotment to Telekom Malaysia of 464.73 million equity shares at a price of Rs 156.96 per Idea share representing 14.99 percent of Idea’s equity capital post allotment. With this acquisition, Idea gains entry into the wireless markets in Punjab and Karnataka, which account for 11 percent in India’s total wireless market. Spice has...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Idea Cellular Essay
  • Idea Cellular Essay
  • Idea Cellular Essay
  • Idea Cellular Strategy Essay
  • The old spice case
  • Idea Cellular
  • Idea Cellular Brand Essay
  • Communication Essay

Become a StudyMode Member

Sign Up - It's Free