India’s fifth-largest mobile operator Idea Cellular has acquired smaller rival Spice Communications in a combined stock and share deal potentially worth 32.4 billion rupees (US$757 million), according to Bloomberg. Idea has acquired a 41 percent stake in the business from MCorpGlobal Communications at 77.30 rupees a share and will make an offer for a further 20 percent at the same price – a premium of around 41 percent on Spice’s most recent share price, says Bloomberg. Idea also said it would merge with Spice via a share swap where Spice shareholders would get 49 Idea shares for every 100 Spice shares held. Once the deal is complete, Idea plans to sell a portion of the merged company’s stock to TM International, the Malaysian operator that currently owns 39 percent of Spice.

According to Times of India, Spice has operations in two of India’s 23 telecom circles and a customer base of over 3 million, while Idea is present in 11 circles and has a customer base of over 26 million. Bloomberg, citing data from the Telecom Regulatory Authority of India, the local regulator, reports that Idea is currently India’s fastest-growing mobile operator. The combined company of around 30 million customers will mean the operator is now close to India’s fourth-placed player, BSNL, which had 36 million GSM subscribers by end of first-quarter 2008, according to Wireless Intelligence data.