Winning Bizness Desk
Mumbai. The central government has decided to acquire a stake in the debt-ridden telecom company Vodafone-Idea Limited (VIL) once the share price stabilizes at Rs 10. According to news reports, sources have said that as per the norms of the market regulator SEBI, the acquisition should be done at the same price. DoT will approve the stake acquisition after VIL's share price stabilizes around Rs 10.
Rs 16,000 cr liability
The telecom company owes a debt of Rs 16,000 crore as interest to the government. In the wake of this liability, its board of directors has offered to pay a stake of Rs 10 per share to the government at par. After the acquisition of this stake, the government's stake in VIL will be around 33% while the promoters' stake in the company will come down from 74.99% to below 50%.
VIL had a total debt of Rs 1,94,780 crore
The promoter and chairman of Vodafone India is Kumar Mangalam Birla. He holds 27% in the company and 44% in UK company Vodafone PLC. The current market cap of the company is Rs 31200 crore. Seeing the poor condition of the company, both the promoters have decided not to make fresh investments in the firm. VIL had a total debt of Rs 1,94,780 crore as of September 30, 2021 and this debt went up to Rs 1,99,080 crore at the end of April-June quarter, 2022. VIL shares are trading below the level of Rs 10 since August 19. On Thursday, its stock closed at Rs 9.68, down 1.02% on the BSE.
VIL is still 3rd largest company
After the arrival of Reliance Jio, Birla's Idea and Vodafone merged into one. After this, four telecom companies remained prominent in the country regarding Bharat Sanchar Nigam Limited (BSNL). Vodafone Idea is continuously making losses and recently there was talk of its sinking. Vodafone Idea is the third largest telecom operator in the country.