Vodafone Idea: Government asks details on investment from Vodafone Idea
on Jul 23, 2021)New Delhi: Struggling telco could soon receive a 15,000 crore fund infusion with movement in its plans to raise the funds through FDI route, though the home ministry – one of key ministries to vet the proposal before it is taken up by the Cabinet – has sought some clarifications regarding the investors.
The board of Vodafone Idea had in September last year approved a plan to raise up to 25,000 crore to fund its expansion and statutory and business needs, but the money is still to flow in.
While the telecom department is believed to have cleared the plan for 15,000 crore funding, the home ministry has sought details, according to an agency report.
“There is no issue in Vodafone Idea raising 15,000 crore but they need to provide investor details for processing of the application,” PTI said.
The approval by Vodafone Idea’s board also included issuance of “unsecured and /or secured, non-convertible debentures” up to an aggregate amount of 15,000 crore, by way of public offering or private placement basis or otherwise, in one or more tranches.”
The fund infusion, when cleared, will be a relief for cash-strapped, telco which has suffered massive losses and is in deep trouble with mounting debt.
It is also losing subscribers and average revenue per user (ARPU), and faces outstanding AGR dues of 50,400 crore as per government data.
Vodafone Idea managing director (MD) & chief executive officer (CEO) Ravinder Takkar in a statement on June 30 had said, “We are in active discussion with potential investors for fund raising, to achieve our strategic intent.”
The company in the last quarter of 2020-21 had reported narrowing of its consolidated loss to 7,023 crore for the quarter ended March 31, 2021.
Total income of Vodafone Idea declined by about 19% to 9,648 crore from 11,920 crore in the corresponding quarter of 2019-20.
The gross debt (excluding lease liabilities) as of March 31, 2021 stood at 1,80,310 crore.
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