India’s telecom war is far from over.
As per reports coming in, Google can buy a minority stake in Vodafone-Idea, and thus, challenge the newly formed partnership of Jio and Facebook in India.
If Google comes on board, then it can change India’s telecom industry.
Google Can Buy 5% Stake In Vodafone-Idea
Google is aiming to make an entry into the telecom industry in India, by acquiring 5% stake in Vodafone-Idea.
The size of this possible deal is still unclear.
As of March, 2020, Vodafone-Idea had a debt of Rs 1.2 trillion. Out of this massive debt, around Rs 900 billion belongs to TRAI’s deferred spectrum debt, and around Rs 250 billion is bank debt.
Supreme Court and Govt has been pressurizing on Vodafone-Idea to clear the spectrum debt, and last year in November, Vodafone CEO gave a warning that their company can shut down their operations in India, if this pressure keeps on building.
Vodafone-Idea has around 11 crore subscribers in India, and controls 30% market share of the telecom users in India.
Why Google Wants To Invest In Vodafone-Idea
Since the debt and the pressure to pay the debt is high on Vodafone-Idea, this seems the most appropriate moment for materializing this unique partnership between Google and Vodafone-Idea.
And the biggest reason why Google wants to enter the telecom market, via Vodafone-Idea is the Facebook-Jio partnership.
In April, Facebook paid $5.7 billion or Rs 44,000 crore to acquire 9.99% stake in Reliance Jio and this shifted the dynamics of the market. Facebook is world’s largest social network, and Jio is India’s #1 telecom provider.
Hence, to counter this massive partnership, Google is aiming to invest in Vodafone-Idea, and claim a pie of the telecom market.
Interestingly, this week itself, Bharti Airtel raised $1.1 billion via share sale, to ramp up their expansion plans.
This is a developing story.. We will keep you updated, as more details come in.
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