By Malvika Gurung
Investing.com -- The promoters of telecom company Vodafone Idea (NS: VODA ), UK’s Vodafone Group PLC (LON: VOD ) and Aditya Birla Group are reported to invest a total of $200 million each, amounting to $400 million as fresh equity to help improve the tethered stance of the telecom company, stated reports on Wednesday.
The decision to infuse a total of $400 million in the beleaguered telco will aid Vodafone and ABG, who currently own a stake of 44.39% and 27.66%, respectively in Vodafone Idea, to retain their stakes in the telco, after it is done raising funds from external investors, state sources privy of the matter.
In September 2021, the telecom operator’s board approved a plan to raise a total of Rs 25,000 crore from external investors, through a mix of equity and hybrid debt.
“Kumar Mangalam Birla is expected to invest the amount via unlisted promoter entities, and none of the group’s listed companies will invest,” stated a source.
Furthermore, while Rs 25,000 crore would be raised from outside investors, the company plans to use the fresh funding towards activities like smooth conduction of daily business operations, invest in strategies promising growth, capital expenditure for expansion of 4G networks and budget allocation for 5G infrastructure, along with spectrum auctions.
As per the relief package announced by the Union Cabinet for the ailing telecom sector on September 15, a four-year moratorium on AGR related dues will be provided, along with several other relief measures that were extended to telecom operators in the country.
A company like Vodafone Idea, which is at the brink of bankruptcy is largely benefitted by this package, as its immediate cash flow burden has been reduced to an extent, and the moratorium will allow the telco to save about Rs 1 lakh crore annually.
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Few days before AadityaBirla said that he is going to close the vodafone Shop.Like 0
idea and vodafone company permanent close in stock market and company shell for all governmentLike 0
when? next lifeLike 0
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thanks for this informationLike 3