NEW DELHI: The government has agreed to increase its stake in Vodafone Idea to 48.99 per cent through a fresh acquisition of shares worth Rs 36,950 crore in exchange for outstanding spectrum auction dues.
In a regulatory filing on Sunday, Vodafone Idea confirmed the move, which will see the government significantly boost its shareholding in the debt-laden telecom operator.
Currently, the government holds a 22.6 per cent stake, making it the largest single shareholder in the company.
Vodafone Idea (VIL) said it has been directed to issue 3,695 crore equity shares of the face value of Rs 10 each at an issue price of Rs 10 each within 30 days after issuance of the necessary order from relevant authorities, including from Securities and Exchange Board of India (Sebi).
"Post the aforesaid issuance of equity shares, the Government of India shareholding in the Company will increase from existing 22.60 per cent to approximately 48.99 per cent. The promoters will continue to have operational control of the company," the filing said, according to news agency PTI.
Last week, Vodafone Idea (Vi) CEO Akshaya Moondra reportedly requested the Department of Telecommunications (DoT) to approve equity conversion for the company's pending Adjusted Gross Revenue (AGR) and spectrum auction dues from 2012, 2014, 2015, and 2016.
Moondra's letter to the DoT, dated March 11, outlined Vodafone-Idea's inability to provide a Rs 6,091 crore bank guarantee or make a Rs 5,493 crore cash payment related to a shortfall from the 2015 spectrum auction.
He asked the DoT to refrain from taking any punitive measures against the company.
Vodafone Idea (Vi), formed in 2018 through the merger of Vodafone India and Idea Cellular, has been struggling due to massive debts, intense competition, and hefty Adjusted Gross Revenue (AGR) dues imposed by the Supreme Court.
In 2021, the government introduced a relief package allowing telecom companies to convert their dues into equity. Vodafone Idea opted for this, leading to the government acquiring a 33 per cent stake in 2023 by converting over Rs 16,000 crore in dues. However, the company continued facing financial distress.
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