Vodafone Idea (Vi) will be issuing 3,695 crore of its equity shares to the Government of India, following the Ministry of Communications’ decision to convert outstanding spectrum auction dues of the telecom company amounting to ₹36,950 crore into shares, as per a stock exchange filing on Sunday.
With this, the Government of India’s shares in Vi will increase from the existing 22.60 per cent to around 48.99 per cent.
“It is hereby informed that Ministry of Communications, has, in line with the September 2021 Reforms and Support Package for Telecom Sector, decided to convert the outstanding spectrum auction dues, including deferred dues repayable after expiry of the moratorium period, into equity shares to be issued to the Government of India under Section 62(4) of the Companies Act, 2013,” said the exchange notification.
Vodafone has been directed to issue 3,695 crore equity shares of the face value of ₹10 within 30 days after issuance of necessary order from relevant authorities. Vi had been hoping to surrender some spectrum bought before 2022 to partly pay for bank guarantees in the near future.
The pricing of shares to be allotted has been arrived basis the higher of the volume weighted price of equity shares during the last 90 trading days preceding February 26, 2025. This pricing is subject to provision of section 53 of the Companies Act, 2013 where shares cannot be issued at less than the par value, as per the filing. The promoters will continue to have operational control of the company.
Last week, the government had put the spectrum surrender proposal on hold. At the time, other telcos Bharti Airtel and Reliance Jio had asked that the government also provide for refund if the surrendered spectrum had been fully paid for. Prior this, the government had also decided not to waive interest and penalties related to adjusted gross revenue dues, a waiver that Vi had been hoping for.
