Idea, part of the metals-to-financials Aditya Birla conglomerate, intends to use the funds to reduce debt including loans for airwave purchases, it said in a regulatory filing.
Last month, Idea announced plans to raise a total Rs 6,750 crore ahead of the proposed merger, which the two sides expect to close during the first half of this year.
Idea said that the share sale launched on Wednesday has a floor price of Rs 86.84 per share, with a potential discount of up to 5 per cent. The shares closed at Rs 84.80 on the National Stock Exchange.
Bank of America Merrill Lynch and Citigroup are managing the sale.
($1 = Rs 64.0950)