Vodafone-Idea merger: Balesh Sharma to helm affairs as CEO

Vodafone and Aditya Birla Group’s Idea Cellular, which are in the final stages of completing the merger of their operations in the country, on Thursday announced the new leadership team of the merged entity. As indicated earlier, Kumar Mangalam Birla, the chairman of the AV Birla Group, will be the non-executive chairman of the merged entity. The two firms have named Balesh Sharma, currently chief operating officer of Vodafone India, the new CEO of the merged entity. He will be responsible for the combined business’s strategy and its execution as well as driving integration. The current CEO of Vodafone India, Sunil Sood, will join the Vodafone Group AMAP leadership team and also help governance through board memberships. Himanshu Kapania, the current CEO of Idea Cellular, will be nominated non-executive board member of the merged entity.

However, both Sood and Kapania will continue in their current roles until such time as the merger is completed. An alumnus of Mayo College with an engineering degree and MBA from Rajasthan University, Balesh’s professional experience spans over 25 years across cultures and geographies, building a strong track record of transformational leadership, successful turnarounds and leading for impact. Having joined Vodafone (then Hutch) in 2003, he has held several senior management positions in India and internationally.

CFO Akshaya Moondra has been appointed the CFO of the merged entity and Ambrish Jain, who is currently deputy managing director at Idea, will be the COO, who will be responsible for circles operations and service delivery. The changes come into effect after the merger has been completed, which both the operators said is expected to be in the first half of the current calendar year. “We are pleased to announce the proposed management team for the new company to be created through the merger of Vodafone India and Idea. The team has extensive operational experience and is an excellent blend of expertise from both companies. We look forward to the completion of the merger and competing as one company in the marketplace,” Birla and Vodafone Group CEO Vittorio Colao said in a joint statement.

After the completion of the $23-billion merger, the contours of which were announced in March 2017, the combined entity will have total revenues at over Rs 80,000 crore, 419 million customers, 35% subscriber market share and 41% revenue market share. The merger will be effected through the issue of new shares in Idea to Vodafone. The total revenue at over Rs 80,000 crore will be less than the consolidated revenue of Bharti’s at Rs 95,468 crore (FY17), but it will be higher if only Bharti’s India operations revenue (Rs 73,422 crore) is taken into account. While Vodafone will hold 45% in the combined entity, Idea’s promoters will have 26%, and the rest will be held by the public.

Vodafone will own 45% stake after selling a 4.9% stake to Idea’s promoters for Rs 3,900 crore, which will then see the Aditya Birla Group’s stake going up to 26%. It will have the right to acquire more shares from Vodafone under an agreed mechanism with a view to equalising the shareholdings over time.