Vodafone and Idea officially announced their merger on Monday. With this merger the the British telecom major will have 45.1% stake whereas the Aditya Birla Group will be having 26% and other Idea shareholders will own the remaining 28.9%.
In a seemingly complicated merger, the official statement says, the Aditya Birla Group can acquire up to another 9.5% stake from Vodafone to equalise the stakes with each other.
“If the Aditya Birla Group does not equalise its stake, Vodafone will reduce its holding in order to equalise its ownership with that of the Aditya Birla Group. Until equalisation is achieved, the additional shares held by Vodafone will be restricted and votes will be exercised jointly under the terms of the shareholders’ agreement,” the statement added.
The companies have not decided the new name of the combined entity but it said it will be decided soon.
On management structure, the statement said the Aditya Birla Group will have the sole right to appoint the Chairman and Kumar Mangalam Birla becomes the new Chairman. Vodafone retains the right to appoint a CFO where as both the entities will choose a CEO as well as the COO.
In total, the Board of the combined entity will be having 12 directors including three directors appointed by each of the party, and six independent directors.