DoT has ruled out the possibility of merger between state-owned telcos – BSNL and MTNL – in the near future on the grounds that the move may face legal hurdles as the private stakeholders of MTNL were opposed to the move.
Government sources said that DoT officials had apprised telecom minister A Raja of this development. (While BSNL is 100% state-owned, MTNL is listed both on the domestic and New York Stock Exchange.)
The DoT had given the mandate of to ICICI Securities to explore the various options under which both the PSUs could be merged, and the latter in its had proposed four possibilities which included making MTNL a subsidiary of BSNL, delisting of MTNL for a subsequent relisting of the combined BSNL-MTNL combine and a reverse merger.
However, despite various meetings between BSNL and MTNL managements and DoT there has been no subsequent progress on this issue.