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| VI Office |
In this artcle, we will discuss Vodafone Group has paid off ₹11,650 crore (approximately £1.09 billion) of debt secured against its stake in Vodafone Idea Limited (VIL). This repayment has unlocked the pledged shares, which represent 22.56% of VIL's total equity.
Debt Settlement Process
Vodafone Group serviced its debt through HSBC Corporate Trustee Company (UK) Limited, which had acted as the security trustee for funds raised by the Vodafone Group entities in Mauritius and India. On December 27, 2024, HSBC issued 15,72,08,26,860 equity shares of VIL that represented 22.56% of VIL's total equity capital after the debt servicing of outstanding dues with lenders.
Vodafone Idea Shareholding Structure as on Date
As of September 2024, the Vodafone Idea shareholding structure has been as follows:
- Vodafone Group: 22.56%
- Aditya Birla Group: 14.76%
- Government of India: 23.15%
Financial Status of Vodafone Idea
During the September quarter, Vodafone Idea saw loss cut down to ₹7,175.9 crores, which was majorly because of the fact that it had seen average revenue per user (ARPU) increase after July's tariff hike. Yet at the same time, this resulted in a downfall for the subscribers of Vodafone Idea.
Voda Idea Sells Stake in Indus Towers
The Vodafone Group has disclosed the sale of its residual 3% stake in Indus Towers Limited that is expected to fetch an amount of ₹2,800 crores. It will settle debts and further aid the Vodafone Idea with outstanding payment.
Fund Raise by Vodafone Idea
The Vodafone Idea board is contemplating raising ₹2,000 crores from entities related to the Vodafone Group. It will raise this capital through equity shares and/or convertible securities on a preferential basis.
Conclusion
Repayment of debt and release of pledged shares by Vodafone Group has been a positive move toward strengthening the financial condition of Vodafone Idea. Another thing is that planned fund-raising initiatives would fortify the operational capabilities as well as long-term stability of the company.
