New Delhi, Sep 1 (IANS) Bharti Infratel’s board has decided to proceed with the long-delayed merger with Indus Towers.
In a regulatory filing on Tuesday, Bharti Infratel said that shareholders of Infratel will be the majority shareholders in the merged entity with a likely stake of 68.6 per cent. Vodafone is likely to have 28.2 per cent.
“After deliberations the Board has decided to authorize the Chairman to proceed with the Scheme and to comply with other procedural requirements for completion of the merger including approaching NCLT to make the Scheme effective subject to certain procedural condition precedents,” it said.
Vodafone Idea has decided to cash out by selling its 11.15 per cent stake in Indus Towers.
“The above is basis cash consideration chosen by Vodafone Idea Limited (VIL) for its 11.15 per cent shareholding in Indus which will be based on 60 days VWAP as at Closing date (and agreed closing adjustments). Based on today’s calculation the cash consideration comes to approx. Rs 4,000 crore,” it said.
The filing said that to secure the payment obligation of VIL under the MSAs, VIL and Vodafone Group Plc (V Plc) have entered into certain security arrangements with the company for the benefit of the merged company.
This includes a combination of a security deposit by VIL, security via pledge of acertain number of shares of the merged company out of those issued to V Plc as part of the scheme and a corporate guarantee by V Plc. which can get triggered in certain situations and events.
These security arrangements remain subject to all applicable regulatory approvals and any approval of V Plc’s lenders. The security arrangement will provide the merged company a payment cover of over one year for the operational payments due from VIL.
The scheme shall become effective on the date on which certified copy of the order of NCLT is filed with Registrar of Companies. The effective date will be communicated to the stock exchanges for further public dissemination as and when the scheme becomes effective.
“While the parties have agreed to proceed to take appropriate steps to progress theapprovals for the merger, the completion of the transaction shall be subject to receipt of all such approvals,” the filing said.
Earlier, the long stop date of the merger was extended five times. The merger was expected to complete by March 2019.