Full text of telecom M&A norms: Merged co's revenue, customer mkt share capped at 50%

The Department of Telecom today released the M&A guidelines for the telecom sector, thereby paving the way for consolidation in the sector.

Here are the highlights:
1. A time period of one year will be allowed for trasnfer of licenses in different service areas

2. Mergers will be allowed where market share for access services in respective area of the resultant area is up to 50 percent. So if the merger results in market share in any service area exceeding 50 percent, the resultant entity willhave to reduce its mkt share to 50 percent within a year

3. Resultant cos’ spectrum holding in service areas cannot cross 25 percent. Buyer will have to pay the difference between the entry fee and the market price of spectrum

4.Payment for spectrum is granted in lieu licence by Govt; excess spectrum to be surrendered in one year.

5. Combined revenue and customer market share for merged company has been capped at 50%