Idea climbs 3% as Sebi examines open offer in Vodafone merger

NEW DELHI: Shares of Idea Cellular climbed nearly 3 per cent in Thursday's trade on reports that market watchdog Sebi is examining whether the proposed merger between Vodafone India and the Kumar Mangalam Birla-owned Idea Cellular will trigger an open offer under the takeover rules.

Following the development, the stock rose 2.92 per cent to hit a high of Rs 88 on BSE.

As per the plan submitted to Sebi, Vodafone will initially hold a 50 per cent stake in the new combined entity, while the Aditya Birla Group and public shareholders will hold 21.1 per cent and 28.9 per cent, respectively, ET reported.

Vodafone will then divest a 4.9 per cent stake to the Aditya Birla Group. This will take the Aditya Birla Group’s stake from 21.1 per cent to 26 per cent, thus crossing the threshold for an open offer, the report added.

Sebi, meanwhile, is also said to have asked for clarifications regarding purchases of Idea stock by Pilani Investment and Industries Corp, part of the Aditya Birla Group, ahead of an official announcement regarding merger discussions.