Vodafone Idea Limited equity conversion likely to take longer

NEW DELHI: The equity conversion of debt-laden telecom operator Vodafone Idea Limited (VIL) could take more time as the government said discussion is going on in this regard. 

Telecom minister Ashwini Vaishnaw on Thursday said, “Vodafone Idea has many requirements. It has a particular requirement of capital. How much capital, who will infuse ... all these things are under discussion at this point of time.” 

He added that the responsibility of capital infusion has to come from various sources. The company just doesn’t require conversion, it requires capital and all those things are a complex issue. Last year in January,  the telco opted for converting about Rs 16,000 crore of interest liability payable to the government into equity, which will amount to about 33% stake in the company, while promoters’ holding will come down to 50% from 74.99%.

Currently, the company is reeling under a debt burden of over Rs 2 lakh crore.  

VIL has offered staked to the government at a par value of Rs 10 a share and the latter is waiting for the company’s shares to stabilise at Rs 10 apiece.

On the launch of 5G services by state-owned Bharat Sanchar Nigam Limited (BSNL), the minister said the latest report suggests it will happen in 2024 now. For the past year, BSNL and the minister maintained that the telco will unveil its 5G services by August 15, 2023.

Vaishnaw also launched 5G services of Jio and Airtel in Odisha. “Entire Odisha will be covered by 5G services in two years. Today, 5G services have been launched in Bhubaneswar and Cuttack,” he added.

Vaishnaw said the Modi government has allocated Rs 5,600 crore for strengthening the telecom connectivity in the state.