The Aditya Birla Group has strongly denied a report stating Idea Cellular was in talks for a merger deal with Vodafone's Indian operations. "Regrettably, there's a wrong-headed and baseless story stating that Idea is in talks with Vodafone on stake sale. This is absolutely untrue and preposterous. There's no such intent," said a spokesperson.
The reaction came after a business channel showed a report of a possible merger. Idea shares even surged around 7 per cent even as broader market indices traded flat. There has been speculation in banking circles about a consolidation deal in the telecom sector. Sources said the merger rumour was "at best a banker's idea", which was later leaked to the media.
The speculation comes at a time when Vodafone is busy preparing to list its Indian unit to the local bourses by early next year. A senior banker said, "There may have been an exchange of ideas, but the story doesn't have many legs as of now." The proposed IPO, among the country's largest, is expected to raise $2.5-3 billion, valuing the company at around $11 billion. Idea Cellular, which has seen its share price fall from about Rs 160 around a year ago to about Rs 100 now, has a market value of just under $6 billion.
