Vodafone Idea prefers stock as payment for Nokia and Ericsson bills
Vodafone Idea Ltd (VIL) plans to raise up to Rs 2,458 crore through a preferential share issue to its two European equipment vendors Nokia and Ericsson, clearing a part of their pending dues and setting the stage for the struggling telco’s 4G expansion and 5G rollout.
The board of directors of VIL approved a preferential allotment of 1.66 billion equity shares at Rs 14.80 per share to Finland’s Nokia and Sweden’s Ericsson, for a total of up to Rs 2,458 crore, the company said in a statement Thursday. Nokia will invest up to Rs 1,520 crore and Ericsson up to Rs 938 crore.
The issue price is 35% higher than that in the April follow-on offer (FPO) of Rs 11 a share and comes with a lock-in period of six months.
ET had reported June 12 on the planned issue of shares to Nokia and Ericsson.
Vi’s Recent Equity Raise at Rs 24,000 crore Shares of VIL closed nearly 2.3% lower at Rs 16.07 on the BSE, giving the telco a market cap of Rs 1.09 lakh crore.
After the share issue, Nokia and Ericsson will hold 1.5% and 0.9%, respectively, in Vi. The promoters — Aditya Birla Group and UK’s Vodafone Group Plc — will own 22.8% and 14.5%, respectively, and the government will hold 23.2%. The public will hold the remaining 37.1%.
With the latest equity issuance, VIL would have raised around Rs 24,000 crore of equity in recent months. Additionally, the carrier said it’s in active discussions with lenders to raise debt funding of Rs 25,000 crore.
“Nokia and Ericsson both have a long-term partnership with VIL, as key suppliers of
