New Delhi: State-run MTNL will be a subsidiary of BSNL by transferring the government’s shareholding to it following the Union Cabinet’s in-principle approval to their merger. The government holds 56.25 percent in MTNL. Its share price was up after a long time. Its share was up 4.55 percent at Rs 8.05.
MTNL on Friday said that it has received a letter from the government detailing the revival plan of the company as an indication of formal communication to begin the resurrection exercise.
In October, the Cabinet had approved the merger of loss-making and incipient telecom firms BSNL and MTNL as part of a revival package which includes raising sovereign bonds, monetizing assets and voluntary retirement scheme (VRS) for employees.
The letter informs that there is in-principle approval for the merger of BSNL and MTNL as per the relevant rules/guidelines of GoI.
Meanwhile, MTNL is to be made subsidiary of BSNL by transferring the Government shareholding of MTNL to BSNL to derive the synergy in network operations and sales until the merger is completed. The Union Cabinet in its meeting held in October considered and approved the proposals of DoT for “Revival of BSNL and MTNL”. (IANS)