New Delhi: Telecom Commission, the highest decision making body of Department of Telecommunications (DoT), is likely to discuss the telecom merger and acquisition guidelines in its October 29 meeting.
"The merger and acquisition guidelines are on the agenda," official sources said. Telecom Minister Kapil Sibal has earlier said the guidelines will be issued by November 1.
The DoT is considering to allow a market share of up to 50 per cent of the resultant entity in case of merger and acquisitions from 35 per cent earlier.
"Transfer of licences consequent to compromise, arrangements or amalgamation of companies shall be allowed where market share for access services in respective service area of the resultant entity is up to 50 per cent," DoT sources said.
The companies will also be allowed to retain two blocks of 3G spectrum in respective areas as a result of the merger, they added.
The resultant entity has to surrender the excess spectrum within one year of the permission being granted failing which action will be taken by the government, sources said.
The guidelines, if approved, is likely to benefit telecom players such as Bharti AirtelBSE -1.66 percent, Vodafone and Idea Cellular.
As per the guidelines, incumbent service providers participating in consolidation activities will have to convert their old licence to Unified Licence, sources added.
In the revised guidelines, a DoT panel on M&A has proposed one year time for completing transaction and exemption from cross holding norms that prohibits incumbent companies from having more than 9.9 per cent stake in competing firms.
The panel on M&A has noted that many telecom service providers are listed on stock exchanges and have to go through a long process to complete the deal.
In fact, under the norms for new Unified Licence regime announced recently, operators are barred from holding any stake in a rival company.
Read Also: HP Remains Optimistic On Computing Market Despite Low GDP Outlook and India's Enterprise Software Market To Reach $ 3.96 Bn In 2013: Gartner
