In Short:
Vodafone Idea will raise Rs 2075 crore from Aditya Birla Group to help with financial issues. This is part of a larger plan to raise Rs 45,000 crore through equity and debt. The company plans to repay vendors, strengthen its network, and launch 5G services to compete with rivals like Reliance Jio and Bharti Airtel. The board has also approved an increase in authorized share capital.
The board of Vodafone Idea (Vi) has approved raising Rs 2075 crore from an Aditya Birla Group entity through a preferential share issue. This move is crucial for the cash-strapped telco’s revival.
Key Details:
“Issuance of upto 1,395,427,034 Equity Shares of face value of Rs. 10/- each at an issue price of Rs. 14.87 per equity share (including a premium of Rs. 4.87 per equity share), aggregating to Rs. 2,075 crores to Oriana Investments Pte. Ltd (Aditya Birla Group entity), on a preferential basis,” Vodafone Idea stated in a notice to the stock exchanges.
The relevant date for determining the floor price of the preferential issue is April 8, 2024.
The board also approved an increase in authorized share capital from existing Rs. 75,000 crores to Rs. 1,00,000 crores, with Rs. 95,000 crore equity share capital and Rs. 5,000 crores preference share capital.
Fundraising Plan:
The promoter’s infusion is part of Vi’s broader fundraising plan totaling Rs 45,000 crore through a mix of equity and debt. The company plans to raise Rs 20,000 crore via equity by June end, and follow that up with around Rs 25,000 crore from lenders.
Impact and Future Plans:
Vi expects this corpus will help in repaying vendors, strengthening its 4G network, and funding the launch of 5G services to compete with rivals like Reliance Jio and Bharti Airtel.
