MTNL rallies on reports of merger with BSNL

NEW DELHI: Mahanagar Telephone Nigam Ltd ( MTNL) rallied as much as 8.65 per cent in trade on Wednesday after the telecom department (DoT) has for the first time set a cutoff date, July 31, 2015, for concluding the much discussed merger of struggling state-run telecom companies, Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd.

At 12:52 p.m.; MTNL was trading 7.49 per cent higher at Rs 32.30. It hit a low of Rs 30.70 and a high of Rs 32.65 in trade today.

In a presentation to Prime Minister Narendra Modi, seen by ET, DoT said it expects to "secure Cabinet approval for the proposed BSNL-MTNL merger by June 30 next year".

MTNL runs telecom services in Delhi and Mumbai while BSNL offers telecom coverage in the rest of India.

Towards this, it plans to wrap up merger consultations with the unions of BSNL and MTNL by March 31, 2015, and circulate a draft Cabinet note for inter-ministerial consultations by April 30 next year, ET reported.

BSNL has 61,622 mobile towers, the second largest tower portfolio among all telcos. A sizeable chunk of its tower assets are colocated with landline exchanges to meet business needs.