The Union government on Friday approved the conversion of Vodafone Idea’s dues linked to interest on spectrum auction installments and adjusted gross revenue worth Rs 16,133 crore into equity.
With this, the government will hold a 33% stake in Vodafone India, making it the biggest shareholder in the telecom service provider, Business Standard reported. Vodafone Idea is a joint venture between the India unit of United Kingdom-based firm Vodafone and Indian conglomerate Aditya Birla Group.
Vodafone India said in a market filing on Friday that it has been directed to issue 16,13,31,84,899 equity shares for Rs. 10 each.
Union Communications Minister Ashwini Vaishnaw said that the Birlas have agreed to manage the telecommunications firm while committing to necessary investments to take the company forward. He said that the investments can come either from the Birlas or along with its partners.
In January last year, the board of directors of Vodafone India had approved the conversion of the entire amount of interest related to spectrum auction installments and adjusted gross revenue dues into equity.
Fifteen entities, most of them telecommunication companies, owe the government Rs 1.47 lakh crore in adjusted gross revenue dues. Of these, Rs 92,642 crore is unpaid licence fees and Rs 55,054 crore is outstanding spectrum usage charges.
In September 2021, the central government had announced a four-year moratorium for telecommunication companies to repay their dues to the government.
The next month, the Centre had given the companies various options to clear the dues as part of the moratorium. One of these options was a one-time opportunity to convert the interest on this deferred payment into equity at the end of the four-year period.
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