The promoters of Vodafone Idea have sought Securities & Exchange Board of India’s (Sebi) approval to increase their shareholding above 75 percent, sources told CNBC-TV18.
The development comes after Vodafone Idea said its board of directors approved a proposal for its rights issue worth Rs 25,000 crore.
The shareholders will receive 87 equity shares for every 38 equity shares they hold on the record date of April 2, the company said in a regulatory filing. The issue will open on April 10 and will close on April 24.
In other words, for every 38 shares held by them, they can buy 87 under the right issue.
The company has already said that if any investor fails to exercise his right to purchase extra shares under the issue, then the promoters have the right to buy those shares as well.
This is likely to push the promoters’ shareholding above the 75 percent threshold. Under Sebi norms, listed companies should have at least 25 percent of their shares held by the public.
As per the sources, Vodafone Idea has sought Sebi’s approval in the interim, if there is not enough participation from the minority shareholders.
It is a three-pronged approach – first, they have made the pricing extremely attractive, so that it will lure the investors to come in and average out whatever losses they have seen. second, they have been speaking to all the investors to get them to be interested and they have also got the Sebi approval.―CNBC TV18