The preferential allotment price stands approximately 35% higher than the FPO price, with a 6-month lock-in period, stated the company.
On June 13, Vodafone Idea, a major player in the telecom industry, announced that its board has given the green light to issue approximately 166 crore shares at Rs 14.80 per share, aiming to raise funds up to Rs 2,458 crore through preferential allotment.
According to a regulatory filing, Vodafone Idea disclosed that it plans to allocate 102.7 crore shares, amounting to Rs 1,520 crore, to Nokia Solutions and Networks India Private Limited, while the remaining 63.37 crore shares, totaling Rs 938 crore, will be allotted to Ericsson India Private Limited.
Furthermore, the board has sanctioned the calling of an extraordinary general meeting on July 10 to seek approval for the aforementioned transactions.
The preferential allotment price, which stands at a 35 percent premium to the FPO price, includes a lock-in period of 6 months.
Following this issuance, Nokia and Ericsson’s shareholding in Vodafone Idea will be 1.5 percent and 0.9 percent, respectively. The Promoter (ABG and Vodafone) shareholding will be 37.3 percent, the Government of India’s shareholding will be 23.2 percent, and the remaining 37.1 percent will be public shareholding.
VIL stated that with this equity issuance, it has raised Rs 24,000 crore. Additionally, the company is actively negotiating with its lenders to secure debt funding amounting to Rs 25,000 crore in accordance with its fundraising roadmap.
CEO of Vodafone Idea Limited, Akshaya Moondra, emphasized the importance of support from key stakeholders for the company’s growth journey. He highlighted the agreement with Nokia and Ericsson as a testament to their long-term partnership, paving the way for the next phase of growth.
On June 13, Vodafone Idea’s shares closed 2.25 percent lower at Rs 16.07 apiece on the BSE.
In related news, a consortium of lenders led by the State Bank of India (SBI) has provisionally approved a Rs 14,000-crore loan to the telecom firm. Vodafone Idea has been implementing various measures, including the launch of 5G services, to turn around its unprofitable operations.
In the March quarter, VIL reported a widening of losses to Rs 7,675 crore, primarily due to increased interest and financing costs.
For the fiscal year ending March 31, 2024, Vodafone Idea posted a widened loss of Rs 31,238.4 crore compared to Rs 29,301.1 crore in the previous year. Despite this, the annual revenue from operations saw a marginal increase of 1.1 percent to Rs 42,651.7 crore.
