No government equity in Vodafone Idea till promoters infuse enough cash

The promoters of Vodafone Idea are unwilling to infuse sufficient capital into the firm, making it unviable for the government to convert the accrued interest on deferred adjusted gross revenue dues into equity, a government official has said. Vodafone Plc of the UK and the Aditya Birla Group have indicated they will infuse around Rs 2,000-3,000 crore, which is inadequate to revive the company. The telco needs around Rs 40,000-45,000 crore to sustain itself. Unless the promoters infuse at least 50 per cent of this, it will be difficult for the company to get external investors, the official said.

Why it’s important: Vodafone Idea has been looking for external investors for several months, but talks have stalled as potential investors want the government to hold stake in the company. That does not seem to be happening anytime soon. Moneycontrol