The merger guidelines, in line with TRAI proposals, include 1) Merged entity’s share of subs or adjusted gross revenues (AGR) cannot be >40% and 2) Minimum four operators required in a service area post-mergers.
DoT will permit merger of operations only upon completion of 3 years from the effective date of the licenses. For new entrants, this implies a 3-year wait before the merger option becomes available.
Deviating from TRAI’s recommendations, the DoT guidelines imply that while there is no cap on merged spectrum, within 3 months from date of approval of the merger by DoT, the licensee (surviving entity) would have to meet the prevailing spectrum allocation criterion (separately for GSM & CDMA technologies) in order to retain the combined spectrum. In other words, the licensee can retain only that amount of spectrum for which it meets the allocation criterion (currently linked to active subscriber base) and surrender “excess” spectrum