Telecom tower company Bharti Infratel on Monday said it has received approval from the Competition Commission of India for its proposed merger with Indus Towers Ltd.

The combined company will own 100 per cent of Indus Towers. Indus Towers is currently jointly owned by Bharti Infratel (42 per cent holding), Vodafone (42 per cent), Idea Group (11.15 per cent) and Providence (4.85 per cent).

Bharti Airtel, Idea Cellular and Vodafone Group in April had announced an agreement for the merger of Indus Towers and Bharti Infratel to create the largest mobile tower operator in the world outside China with over 1.63 lakh towers across 22 telecom service areas.

“…approval of Competition Commission of India has been received for the proposed merger of Bharti Infratel Ltd and Indus Towers Ltd,” Bharti Infratel said in a regulatory filing.

As per the deal, Bharti Airtel and Vodafone will jointly control the combined company, and the transaction is expected to close before the end of 2018-19, subject to statutory approvals. The deal gives Idea Group an option to sell its 11.5 per cent stake in Indus Towers for cash or in lieu of receiving new shares. Providence too has the option to receive cash or shares for 3.35 per cent of its 4.85 per cent shareholding in Indus Towers with balance exchanged for shares. According to the deal, Vodafone will be issued 783.1 million new shares in the merged entity in exchange for its 42 per cent stake in Indus Towers, and this could take its holding to 29.4 per cent in new company depending on the options finally taken by Idea and Providence.

Similarly, Airtel’s stake in the new combined tower behemoth may be diluted to 37.2 per cent from 53.5 per cent it currently holds in Bharti Infratel. Shares of Bharti Infratel closed at ₹298.55 on the BSE on Monday, down 2.85 per cent from the previous close.

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