Vodafone Idea May Convert Nokia, Ericsson Debt into Equity for the Vendors: Report

With 4G expansion and 5G rollout in the books, Vi can't sit idle for too long. According to an ET report, Vi is considering converting either a part of the dues or the complete amount into equity for Nokia and Ericsson.

Highlights

  • Vodafone Idea (Vi), a prominent telecom operator in the country, is reportedly considering converting dues towards European vendors into equity.
  • The telco has done this in the past with the Indian government.
  • Vi is estimated to owe around Rs 3,000 crore to Nokia and Rs 500 crore to Ericsson.

Follow Us

vodafone idea may convert nokia ericsson debt

Vodafone Idea (Vi), a prominent telecom operator in the country, is reportedly considering converting dues towards European vendors into equity. The telco has done this in the past with the Indian government. Now, it may happen with Nokia and Ericsson, two of the largest telecom gear and technology vendors in the globe. Both Nokia and Ericsson haven't been able to get their money from Vi due to the liquidity issues that the telco has been facing.




However, with 4G expansion and 5G rollout in the books, Vi can't sit idle for too long. According to an ET report, Vi is considering converting either a part of the dues or the complete amount into equity for Nokia and Ericsson. But it is not just Ericsson and Nokia, Vi also owes money to Indus Towers - around Rs 10,000 crore.

Read More - Vodafone Idea Launches OTT Subscription Bundled Plans With Disney+ Hotstar, Sony LIV

The report said that Vi is estimated to owe around Rs 3,000 crore to Nokia and Rs 500 crore to Ericsson. The telco has incurred close to Rs 2 lakh crore in loss over the last five years. This had restricted its ability to raise funds to a certain extent. However, in early 2024, Vodafone Idea managed to secure funding from promoters as well as raise money through a follow-on public offer. Vi raised a total of Rs 20,000 crore through equity and plans to raise another Rs 25,000 crore through debt in the coming years.

Read More - Vodafone Idea Must Pay Dues to Indus Towers to Get New Services: Report

Conversion of debt into equity will dilute the current shareholders further. The report said that Vi is also considering issuing OCDs (optionally convertible debentures) to the vendors as it did to the American Tower Company (ATC).

Vi wants to launch 5G later this year, and for that, it will certainly need Ericsson and Nokia's help. Thus, it will be key to watch what happens here.

Reported By

Tanuja is a passionate technology and telecom buff who has been following the telecom industry for several years now.

Recent Comments

Samrat Gupta :

Great analogy. ??? However Airtel still provides the cheapest monthly plan with unlimited voice call and 2 gb Data for…

Jio, Airtel, Vi Minimum Recharge to Keep Validity after Tariff…

Amit Madan :

Very disappointing. Nothing happening in favor of middle class people. More people now will migrate to OTT or Free Dish…

TRAI Removes NCF Ceiling for DPOs, Announces Amendments to Boost…

Tanay Singh Thakur :

Interesting, thanks for sharing!

Vodafone Idea Amazon Prime Prepaid Packs after Tariff Hike, Details…

Karthik Anand :

904 plan still continuing in Tamil Nadu circle

Vodafone Idea Amazon Prime Prepaid Packs after Tariff Hike, Details…

Bharath Raj S :

Anyone's developer options network speed limit is working? While current 2g keypad calling users plan price is equal to 4g…

BREAKING: Reliance Jio Removes Base Rs 149 and Rs 179…

Load More
Subscribe
Notify of
0 Comments
Inline Feedbacks
View all comments