Vodafone is the world’s second largest cellphone networks operator, and is in talks to merge its Indian business with local rival Idea Cellular. The information is confirmed by both companies but no specifics like deal worth have been disclosed.
According to analysts the merger would result in a group with around 375 million subscribers and 36% market share.
By joining forces with Idea Cellular in India, Vodafone would become much more competitive against Bharti Airtel and Reliance Jio Infocomm, a new carrier backed by India’s richest businessman Mukesh Ambani.
Jio’s aggressive deals with free calls and low-cost data pushed Bharti Airtel, Vodafone and Idea to slash their prices and settle for lower profits.
Vodafone had entered the Indian market in 2007 and was having a quite bumpy ride ever since then, thanks to price wars and a legal battle over a $2 billion tax claim.
We do think that tough competition from Jio must have been the reason for Vodafone to look for a merger.What do you think? Tell us in the comment section.