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Vodafone Idea board to meet today to mull fundraising via equity

The Vodafone Idea (Vi) board is scheduled to meet today, February 27 to consider proposals for its long-pending fundraise through equity.




“A meeting of the board of directors will be held on February 27 to consider and evaluate any and all proposals for raising of funds in one or more tranches by way of a rights issue, further public offer, private placement, including preferential allotment, qualified institutions placement (QIP) or through any other permissible mode and/or combination thereof as may be considered appropriate,” said Vi in its exchange filing.

This fundraise is over and above the Rs 2,000 crore already committed by the promoters in August last year.

Aditya Birla Group holds an 18.1 per cent stake in the company, while the Indian government owns 33 per cent. The UK’s Vodafone Group has a 32.3 per cent stake.

Kumar Mangalam Birla, chairman Aditya Birla Group has reaffirmed his company’s commitment, “We remain very committed to Vi, and like we have said in public domain, efforts are on to get outside investors,” he said. “We are making good progress, but can’t put a timeline.”

The govt has decided against diluting its stake. At 33 percent, it remains the largest shareholder in the company.

The telco has a debt of nearly Rs 2.14 lakh crore in the fiscal third quarter, and existing debt payable by December 31, 2024 is ₹5,385 crore.

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In the absence of headline rate increases, Vi would require around $8-10 billion (Rs 65,000-83,000 crore) of fresh capital over the next two years to have a 5G mobile broadband network, says Goldman Sachs.

Analysts say this is the first step toward a “multi-billion-dollar infusion” for the company.

Shares of Vodafone Idea Ltd fell more than 2 percent on February 26. No listed company of the Aditya Birla group is likely to participate in the fundraising plans and the promoters will fund the company, said CNBC-TV18.

CT Bureau

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