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Friday, February 19, 2010

Idea Cellular


Idea Cellular

Idea Cellular is a wireless telephony company operating in all the 22 telecom circles in India based in Mumbai. It is the 3rd largest GSM company in India behind Airtel and Vodafone and ahead of state run player BSNL.

In 2000, Tata Cellular was a company providing mobile services in AP. When Birla-AT&T brought Maharashtra and Gujarat to the table, the merger of these two entities was a reality. Thus Birla-Tata-AT&T, popularly known as Batata, was born. In 2001, the Batata triumvirate agreed to merge its operations with the Rajeev Chandrasekhar promoted BPL Communications. The merger could have brought in regions like Mumbai, Maharashtra, Kerala and Tamil Nadu, which seemed to be a perfect accompaniment to what it already had. This was critical with the bid for the fourth operator licence round the corner.
However, the engagement with BPL was broken. Then Idea set sights on RPG’s operations in Madhya Pradesh which was successfully acquired, helping Batata have a million subscribers, and the licence to be the fourth operator in Delhi was clinched.

In 2004, Idea (the company had by then been rechristened) bought over the Escorts group’s Escotel gaining Haryana, Uttar Pradesh (West) and Kerala — and licences for three more — UP (East), Rajasthan and Himachal Pradesh. By the end of that year, four million Indians were on the company’s network. In 2005, AT&T sold its investment in Idea, and the year after Tatas also bid good bye to pursue an independent telecom business. And Idea was left only with one promoter, the AV Birla group When the company’s stock listed on the bourses in March 2007, its subscriber base was 13 million with presence in 11 circles. In less than three years, the subscriber numbers have more than quadrupled. The public issue was oversubscribed 50 times and raised Rs 2,450 crore.



In June 2008, Idea Cellular bought out BK Modi’s stake in Spice Communications for Rs 2,700 crore adding Punjab and Karnataka circles. Modi’s joint venture partner, Telekom Malaysia, invested Rs 7,000 crore for a 14.99% stake in Idea. Just around then, Idea’s subsidiary, Aditya Birla Telecom sold a 20% stake to US-based Providence Equity Partners for over Rs 2,000 crore.

The company has its retail outlets under the "Idea n' U" banner. The company has also been the first to offer flexible tariff plans for prepaid customers. It also offers GPRS services in urban areas.

Idea Cellular won the GSM Association Award for "Best Billing and Customer Care Solution" for 2 consecutive years.


Holding

Initially the Birlas, the Tatas and AT&T Wireless each held one-third equity in the company. But following AT&T Wireless' merger with Cingular Wireless in 2004, Cingular decided to sell its 32.9% stake in Idea. This stake was bought by both the Tatas and Birlas at 16.45% each.

Tata's foray into the cellular market with its own subsidiary, Tata Indicom, a CDMA-based mobile provider, cropped differences between the Tatas and the Birlas. This dual holding by the Tatas also became a major reason for the delay in Idea being granted a license to operate in Mumbai. This was because as per Department of Telecommunications (DOT) license norms, one promoter could not have more than 10% stake in two companies operating in the same circle and Tata Indicom was already operating in Mumbai when Idea filed for its licence.

The Birlas thus approached the DOT and sought its intervention, and the Tatas replied by saying that they would exit Idea but only for a good price. On April 10, 2006, the Aditya Birla Group announced its acquisition of the 48.18% stake held by the Tatas at Rs. 40.51 a share amounting to Rs. 44.06 billion. While 15% of the 48.14% stake was acquired by Aditya Birla Nuvo, a company in-charge of the Birlas' new business initiatives, the remaining stake was acquired by Birla TMT holdings Private Ltd., an AV Birla family owned company. Currently, Aditya Birla Group holds 49.1% of the total shares of the company. Malaysia based Axiata controls a 14.99% stake in the company.

Users




Idea's subscriber base as of November 2009 according to the is as follows

* Maharashtra and Goa - 8,703,670
* Madhya Pradesh and Chhattisgarh - 6,313,183
* Andhra Pradesh - 6,020,386
* Kerala - 5,021,067
* Kolkata - 140,149
* Gujarat - 4,721,945
* Uttar Pradesh (West) & Uttarakhand - 5,203,726
* Delhi - 2,430,274
* Haryana - 1,881,659
* Uttar Pradesh (East) - 3,133,981
* Rajasthan - 2,073,877
* Himachal Pradesh - 212,014
* Mumbai - 1,221,653
* Bihar & Jharkhand - 2,403,949

* Tamil Nadu & Chennai - 58,639
* Odisha - 455,495
* Punjab (Spice) - 3,002,267
* Karnataka (Spice) - 2,181,237
* Rest of Bengal - Newly launched
* Assam - Newly Launched

for more information about !dea cellular visit idea cellular

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