Vodafone Idea announced on Tuesday that its board had approved the conversion of the full amount of interest on spectrum auctions and dues to the government into equity.
The decision means that following conversion, the government will hold about 35.8 per cent of the shares of the company, Reuters reported.
Vodafone Group would hold around 28.5 per cent and Aditya Birla Group around 17.8 per cent.
Last year, when unveiling a sector reform package, the government had offered telecom operators the option of converting their dues into equity. “The net present value (NPV) of this interest is expected to be about ₹16,000 crore as per the company’s best estimates, subject to confirmation by the DoT. Since the average price of the company’s shares at the relevant date of 14.08.2021 was below par value, the equity shares will be issued to the government at par value of ₹10 per share, subject to final confirmation by the DoT,” the Vodafone Idea statement said.
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“Vodafone Idea, a combination of the India unit of Britain’s Vodafone Group and Idea Cellular, has paid the government 78.54 billion rupees in government dues, but still owes roughly 500 billion rupees,” Reuters reported.
Interestingly, Bharti Airtel had informed it would not avail of the option to convert dues to equity.