Mumbai, June 3: The merger process that would transform Reliance Communication Ventures Ltd (RCoVL) ? a communication venture enterprise ? into a fully-integrated communication business provider is expected to be completed in another three to four months.
This was announced at the extraordinary general meeting of RCoVL held today to seek shareholders? permission for the amalgamation of nine Anil Dhirubhai Ambani group firms with the company.
The nine companies that will be amalgamated with RCoVL include Reliance Infocomm, Reliance Communications Infrastructure (RCIL), Reliance Communications Solutions, Reliance Software Solutions, Reliance Communications Technologies, Ambani Enterprises Private (AEPL), Reliance Business Management (RBM), Formax Commercial and Panther Consultants (PCPL).
Most of the shareholders expressed their support for the merger resolution. Anil Ambani was not present at the court convened meeting chaired by Justice M.H. Kania. Later, company secretary Hasit Shukla said while the stamp duty payable on account of the merger will be Rs 25 crore, there will be no change in the composition of RCoVL?s board of directors. Most of the companies that are being merged with RCoVL are based in Ahmedabad. However, the combined entity will be located in Mumbai and its registered office will also be based in the country's commercial capital.
Post-merger, RCoVL?s equity capital will rise to Rs 1,022 crore, up Rs 410.75 crore from Rs 611.56 crore. Replying to a query on why Reliance Telecom is not being merged with RCoVL, he said the unit will be its wholly-owned subsidiary and that all benefits will still accrue to RCoVL.
Some shareholders listed out the benefits of the merger, saying that while RCoVL now holds less than 50 per cent in most of the units that are being merged, its value will not be appropriately reflected in the stock markets in the present avatar as it is largely a holding company. This, they said, will change after the merger process is completed.
RCoVL also took shareholders? permission in a separate meeting for a sponsored American Depository Receipt (ADR)/Global Depository Receipt (GDR) offering up to $1 billion. The company also sought approval for a change in its name to Reliance Communications Ltd.
Shukla said the company was not raising any funds through the offering. The issue, which entails domestic shareholders tendering their shares to foreign investors, has been proposed to spread the company?s base overseas.
