

Excerpted with permission from The Pioneer.

The much-awaited Government plan for merger of two State-owned telecom firms has taken a final shape as Mahanagar Telephone Nigam Limited (MTNL) and Bharat Sanchar Nigam Limited (BSNL) are all set to start functioning as a single new entity from the next financial year. The name of the proposed new entity will be declared soon by the Government, while the merger will happen by the end of December. The Department of Telecommunications (DoT) is working on the issue, and after the merger both the public sector telecom firms will synergise operations by offering their services across the country as a single entity.

“Though the decision on merging BSNL and MTNL is expected to happen by December-end this year, the other pre-merger procedures of the Government will continue till March 31, 2016. The proposed newly-formed entity will start its operation at the beginning of the next financial year in April 2016,” a highly-placed Government source told The Pioneer on Sunday.

The DoT in September last year had set a deadline of July 31, 2015 for closing the merger of MTNL and BSNL. But due to some reason or the other, it couldn’t happen on time. Earlier this year, the Prime Minister’s Office (PMO) had requested Indian Institute of Management (IIM), Bangalore, to prepare and submit a feasibility report on the merger of BSNL and MTNL.

“In response to the Government’s request, IIM-B, however, has submitted its final report to the PMO on July 16 this year, stating therein how the new organisation would function in the telecom competitiveness at par with the private telcos in the country. Both the DoT and the Government in supervision with the PMO are studying the report to take it forward as to smoothly operate these two PSU units into single telecom firm. The final blueprint in this matter will come to the public domain shortly,” the source said.

When contacted about the development, a senior Government functionary involved in the process… Click here to read the full story at The Pioneer.

Also read: MTNL reports Rs 744.97 crore loss for Q1-FY16; Cellular revenues 21% of total