New Delhi: Crisis-ridden telecom major Vodafone Idea board on Tuesday said that it cleared Rs 20,000 crore for fund-raising via a combination of equity and equity-linked tools and promoters will also participate in the proposed equity raise. Overall, Vodafone Idea plans to raise around Rs 45,000 crore through a mix of equity and debt, the company said in a release.
The company has been fighting a desperate battle for survival -- it has a debt of Rs 2.1 lakh crore and is reporting quarterly losses, amid massive subscriber churn. The Board has also authorised the management to appoint bankers and counsels to execute the fund raise.
The company will call for a meeting of its shareholders on April 2, 2024, and post-shareholders' approval it expects to complete the equity fund raise in the coming quarter. The promoters will also participate in the proposed equity raise, as committed earlier.
“In addition, the company remains actively engaged with its lenders for tying up the debt funding, which will follow the equity fund raise. Through a combination of equity and debt, the company plans to raise around Rs 45,000 crores,” it said.
Voda Idea said its bank debt currently stands at less than Rs 4,500 crore. “The equity and debt fund raising will enable the company to make investments towards significant expansion of 4G coverage, 5G network rollout and capacity expansion,” the release said.
The company expects that these investments will enable the company to improve its competitive positioning and offer an even better customer experience. “The company has consistently shown an improvement in performance even with limited investments. With the proposed fund raise and the positive operational developments, the company is confident of effectively competing in the market,” it added.
The government holding in Vodafone Idea Ltd is currently pegged at 33.1 per cent after it converted the accrued interest towards statutory dues into equity in 2023.
