Vodafone Promises To Invest Rs 10,000 Crore For Improving Data, Voice Services
Vodafone Plc and Aditya Birla Group, who are the promoters of Vodafone Idea will now be putting equity capital in the Vodafone Idea, and they have apparently assured the government of this.
The officials in the Department of Telecommunications (DoT) have confirmed this as well.
How much will these promoters invest in Vodafone? Will it help revive the company? Read on to find out!
Promoters Vodafone Plc and Aditya Birla To Invest Rs. 10,000 Crores In Vodafone Idea
The officials of the DoT have revealed that the promoters have assured the government that they will invest around Rs 10,000 crore in the company. They have also stated that these investments will help Vodafone Idea get to a comparatively better position. This will also maintain the competition in the telecom sector.
Vodafone Plc and Aditya Birla Group hold 44.39% and 27.66% stakes in Vodafone Idea respectively.
Guidelines for the companies to pay the interest component of their AGR and spectrum dues through equity to the government will also be announced soon.
Vodafone To Start Fundraising Exercises
As per reports, the telecom relief package that has been approved by the government has allowed for deferment of payment of the AGR. Also, the spectrum dues of the operators have also been deferred for four years with the net present value (interest) protected.
The government has also offered the operators the option to pay by equity to make up for the interest. The principal amount, as per the government, will be converted into equity if the operator fails to pay.
Vodafone Idea CEO and MD Ravinder Takkar had recently stated, “The promoters have invested `1.90 lakh crore in the last 10 years. The enthusiasm and interest to invest in the sector has increased with the government’s package.” The company, as per Takkar, will also be going for a fundraising exercise wherein the co-promoters of the company will be able to participate as well.
Last year, Vodafone Idea had stated that it would raise around Rs 25000 crores from the investors. However, the company had later stated that the investors were concerned about issues surrounding the adjusted gross revenue (AGR) dues and tariff structure.