Vodafone Group Plc Might Invest Another Rs 285 Crore in Vodafone Idea

Vodafone Group has the potential exposure of investing a maximum amount of Rs 8,400 crore in Vodafone Idea

Vodafone Group Plc might invest Rs 285 crore in Vodafone Idea. The investment in Vodafone Idea will be made as per the terms of the agreement made with Idea Cellular back in 2018. It is expected that Vodafone Group Plc will invest the amount by September. Since the telco giant is facing financial distress to generate cash and clear off its financial liabilities, investment by Vodafone Group Plc will aid Vodafone Idea in maintaining cash liquidity and financial position. This news is reported by ET Telecom.

Investment by Vodafone Group Will Aid Telco to meet its Operational Expenditure

Vodafone Idea is already facing the burden of massive AGR dues. The telco has to approximately pay Rs 58,254 crore to the government towards AGR dues. Vodafone Idea has just cleared three instalments of the AGR dues which is worth Rs 6,584 crore. Another plunge of investment by Vodafone Group Plc will help the telco to meet its operating expenses and maintain financial stability.

Vodafone Group has Already Transferred $200 Million to Vodafone Idea

Vodafone Group has already transferred $200 Million to Vodafone Idea in April. Since the spread of Covid-19 was increasing, Vodafone Idea was facing massive financial distress as the government imposed a lockdown period to combat the deadly virus. The payment by Vodafone Group was made under the contingent liability clause (CLC) which was signed by the telcos at the time of the merger between Vodafone and Idea and the payment was due in September 2020. The investment was made by Vodafone Group to help Vodafone Idea with financial liquidity amid the lockdown period.

Vodafone Group Can Potentially Invest up to Rs 8,400 Crore in Vodafone Idea

The Vodafone Group, Idea Cellular and Aditya Birla Group had already discussed the terms of the investment and reimbursement. Vodafone Group has the potential of investing a maximum amount of Rs 8,400 crore in Vodafone Idea which would help the telco in future. Since Vodafone Idea is already under tremendous financial burden due to massive AGR dues, the group has shown its concerns regarding the financial position of the telco giant. Also, the investment is made with the motive of reviving Vodafone Idea from a cash crunch situation.

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saketChetanKaushik Roy Recent comment authors
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Kaushik Roy
Kaushik Roy

All news is about Vodafone only . Why idea is silent? Why they are not investing? Are they not interested in this merger. Vodafone is taken over postpaid and there is no reason why they also not take over prepaid from idea. Idea should quit if they can not invest.

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Kolkata
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Jio airtel
Chetan
Chetan

One should be careful reading between the lines in news. This is not out of blue investment . This is statuary obligation fund infusion which was signed between AB group and Vodafone PLC during merger. So they are making payment now. This peanut funds is not enough to fund even 2 month salary of Vodafone idea. Not sure why it even make news also

saket
saket

VIL is currently running on PUSH TO MOVE vehicle . i want to say board is knowing that its game over, but still putting some effort like GST refund, Appeal in HC, this statutory fund, disinvestment from Indus and others So that they can just push for few days/weeks/month before its completly gets evoporated in air. Borad might be under some immense pressure to show some results so that Some angel ( foreign telco like AT T/investment group) which was willing to enter indian market but just sitting on fence to see Govt and Customer and economy response, so that… Read more »

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