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Vi board to discuss fundraise on Friday
- The vendor could be Indus Towers. Vodafone Idea has unpaid dues of over ₹7,000 crore to Indus
Vodafone Idea Ltd’s board of directors will meet on 21 October to consider a fundraising through convertible debentures, it said in an exchange filing on Wednesday.
“A meeting of the board is scheduled to be held on October 21, inter-alia, to consider and evaluate a proposal for issuance of debenture securities convertible into equity shares on a preferential or private placement basis to a vendor, subject to regulatory and other statutory approvals as may be required, including approval of the shareholders of the company,” the telco said.
According to two people in the know, the vendor could be telecom tower infrastructure firm Indus Towers. Vodafone Idea has unpaid dues of over ₹7,000 crore to Indus, they said seeking anonymity.
According to one of the two people, it may result in converting 70-80% of total dues into debentures that would be valid for at least one year.
“This will give Vi more time to pay the dues and allow it to keep running operations,” an industry executive, the second person cited above, said. “This step will give Vi time beyond the stipulated period given by Indus to settle the dues, which ends next month.
A second executive said this arrangement will be beneficial for Indus as well even though it may not get cash immediately in lieu of the pending dues, but if it stops offering services to Vi it will result in loss of revenues as the dues will remain perpetually unpaid. The Aditya -Birla Group-owned carrier with over 260 million subscribers is yet to conclude its fund raising of over ₹20,000 crore, which it requires to be competitive in the industry, with rivals Bharti Airtel and Reliance Jio laying out aggressive plans to launch 5G services.
The top two carriers have signed up vendors for 5G telecom gear to be used for deploying the networks, but Vodafone Idea is yet to finalise the contracts.
When contacted, Vodafone Idea did not respond queries on the proposals that it board may consider till press time.
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First Published:19 Oct 2022, 10:29 PM IST
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