iWorld
Vodafone Idea officially starts operation as largest Indian telco
MUMBAI: The mega Vodafone-Idea merger in the Indian telecom sector finally comes to closure creating India’s largest telecom operator with the most subscribers and revenue share. The new entity stands with a subscriber base of over 408 million and 32.2 per cent pan India revenue market share. However, both the brands will continue to operate independently. The National Company Law Tribunal (NCLT) approved the merger yesterday.
The merger has displaced Bharti Airtel from the top spot which has held the spot for the last 15 years. As of July 2018, the company has a user base of 344 million. Now the Indian telecom sector stands with three large players – Vodafone Idea, Bharti Airtel and Reliance Jio. Mukesh Ambani-led Reliance Jio is the third largest telecom operator in the country with 215 million subscribers.
“Today, we have created India’s leading telecom operator. It is truly a historic moment. And this is much more than just about creating a large business. It is about our vision of empowering and enabling a new India and meeting the aspirations of the youth of our country. The ‘Digital India’, as our Prime Minister describes it, is a monumental nation building opportunity. As Vodafone Idea, we are partnering in this initiative by building a formidable company of international repute, scale and standards,” Aditya Birla Group and Vodafone Idea Ltd chairman Kumar Mangalam Birla commented.
Kumar Mangalam Birla has been named as the chairman of Vodafone Idea Ltd and Balesh Sharma as the CEO of the combined entity. The new board of directors include six independent directors.
The merger is expected to generate Rs 140 billion annual synergy, including opex synergies of Rs 84 billion, equivalent to a net present value of approximately Rs 700 billion. The Department of Telecom (DoT) had given a conditional nod for the merger of these companies on 9 July.
“As India’s leading telecom operator with two popular and loved brands, the company has the scale and resources to ensure sustainable customer choice and introduce new technologies. We are committed to offer both our retail and enterprise customers an excellent experience while fulfilling their evolving digital and connectivity needs via new products, services and solutions. We will offer them more network coverage, more value and more excitement. My team and I look forward to your continuing support and invite you to enjoy the Vodafone Idea experience,” Sharma said.
iWorld
Bill Ackman’s Pershing Square makes $64 billion bid to acquire Universal Music Group
Ackman pitches NYSE relisting plan as UMG board weighs unsolicited offer
The hedge fund has proposed a business combination that values UMG at €30.40 per share, representing a hefty 78 per cent premium to its current trading price. The offer includes €9.4 billion in cash alongside stock in a newly formed entity, with shareholders set to receive €5.05 per share in cash and 0.77 shares in the new company for each UMG share they hold.
Under the proposal, UMG would merge with Pershing Square SPARC Holdings Ltd and re-emerge as a Nevada-based entity listed on the New York Stock Exchange. The move is designed to boost investor visibility and potentially secure inclusion in major indices such as the S&P 500.
Pershing Square Capital Management ceo Bill Ackman argued that while UMG’s operational performance remains strong, its market valuation has lagged due to external factors. “UMG’s stock price has languished due to a combination of issues that are unrelated to the performance of its music business,” Ackman said, pointing to concerns ranging from shareholder overhang to delayed US listing plans.
Ackman also flagged what he sees as untapped potential in UMG’s balance sheet and a lack of clear capital allocation strategy. He added that the market has not fully recognised the value of UMG’s €2.7 billion stake in Spotify, alongside gaps in investor communication.
The proposed transaction would also result in the cancellation of around 17 per cent of UMG’s outstanding shares, while maintaining its investment-grade balance sheet. Pershing Square has said it will fully backstop the equity financing, with debt commitments secured at signing. The deal is targeted for completion by the end of the year.
UMG, however, has struck a measured tone. The company confirmed that its board has received the non-binding proposal and will review it with advisers. It reiterated confidence in its current strategy and leadership under Lucian Grainge, signalling no immediate shift in stance.
The proposal comes at a time when global music companies are navigating evolving investor expectations, streaming economics and capital allocation pressures. For Pershing Square, the bet is clear: sharpen the financial story, relist in the US, and let the music play louder in the markets.
Whether UMG’s board is ready to change the tune remains to be seen, but the spotlight on its valuation just got a lot brighter.
