 "RCom extends merger talks with Aircel by 60 days")
Rcom said on Wednesday it had extended the exclusive period to negotiate a possible merger with Aircel to May 22, 2016. The decision to merger is part of the consolidation witnessed by the industry to derive benefits in opex and capex synergies and revenue enhancement.
R Com also stated that discussions were non-binding in nature and that the transaction would be subject to completion of due diligence, definitive documentation and regulatory, shareholders’ and other third party approvals.
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Hence, there was no certainty that any transaction would result. On 23 December 2015, R Com had announced it had entered into a 90-day non-binding exclusivity period with Maxis Communications Berhad and Sindya Securities and Investments, shareholders of Aircel, to consider potential combination of their Indian wireless business.
The announcement came a month after R Com’s announcement of a similar deal with MTS, the Indian arm of Russia’s Sistema Group, which signalled the beginning of consolidation in the telecom sector.
R Com could, after the two mergers, become the country’s second-largest telecom company by subscribers after Sunil Mittal’s Bharti Airtel. R Com is now the fourth-largest telecom company by subscribers trailing Vodafone and Idea Cellular. Aircel comes in at fifth position.
Aircel offers 2G services in 19 circles, excluding Kolkata, Delhi, Mumbai and Chennai. It has 3G spectrum for 13 circles and 4G spectrum for eight and has over 84 million users.