Telecom mergers and acquisitions policy unveiled

April 22nd, 2008 - 7:08 pm ICT by admin  

New Delhi, April 22 (IANS) Mergers and Acquisitions (M&As) of telecom licensees would not be allowed if the number of service providers falls below four after any such move, according to the new guidelines announced by the government Tuesday. Both parties would also need prior approval of the Department of Telecommunications (DoT) for any M&A to take place.

The Department of Telecommunications (DoT), in a statement here, said the combined market share of the new company created after M&A should not cross 40 percent either in terms of subscriber base or revenues.

“The revised guidelines, it is hoped, will increase competition within the service area and will lead to better utilisation of services,” the DoT said.

After a particular M&A, the new entity would obtain the total amount of spectrum held by the merging entities, it said.

Any permission for merger shall be granted only after completion of three years from the effective date of the licences, according to the new guidelines.

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