Government may take stake in Voda-Idea
Government may take a stake in Voda-Idea: Company offered to take a stake at Rs 10, steps taken to repay debt
The government will acquire a stake in the debt-ridden telecom company Vodafone-Idea Limited (VIL) once the share price stabilizes at Rs 10. An official source has given this information. According to PTI, the source said that as per the norms of the market regulator SEBI, the acquisition should be done at the same price. DoT will approve the stake acquisition after VIL's share price stabilizes around Rs 10.
The government has to pay about Rs 16,000 crore as interest on VIL. In lieu of this liability, its board of directors has offered to pay a stake of Rs 10 per share to the government at par. After the acquisition of this stake, the government's stake in VIL will be around 33% while the promoters' stake in the company will come down from 74.99% to below 50%.
The promoter and chairman of Vodafone India are Kumar Mangalam Birla. He holds 27% in the company and 44% in the UK company Vodafone PLC. Company's current market cap
31200 crores are Rs. Seeing the poor condition of the company, both the promoters have decided not to make fresh investments in the company.
VIL had a total debt of Rs 1,94,780 crore as of September 30, 2021. This debt increased to Rs 1,99,080 crore at the end of the April-June quarter, 2022.
VIL shares are trading below the level of Rs 10 since August 19. On Thursday, its stock closed at Rs 9.68, down 1.02% on the BSE.
After the arrival of Reliance Jio, Birla's Idea and Vodafone merged into one. After this, four telecom companies remained prominent in the country regarding Bharat Sanchar Nigam Limited (BSNL). Vodafone Idea is continuously making losses and recently there was talk of its sinking. Vodafone Idea is the third largest telecom operator in the country.
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