Vodafone Idea (Vi), one of the prominent Indian telecom operators, may be able to raise another Rs 2,000 crore from its UK promoter Vodafone Group Plc. Vodafone UK had cleared its intent of not involving itself any further in the Indian telecom business unit, however, it may soon change. Vodafone UK is looking to sell the remaining 3.1% stake in Indus Towers after selling 18% recently for Rs 15,300 crore. Now, the UK telecom giant is looking to sell the remaining stake as well.
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Vodafone UK is reportedly talking to Airtel for the remaining shares. Both companies also engaged in the past, but due to valuation differences, could not come to an agreement. However, as per an ET report, this time the discussions between the two companies could yield positive results. Vi would very much appreciate it if Vodafone UK extended this help of Rs 2,000 crore.
The report said that this money would go towards Vi paying off the existing dues to Indus Towers. Vodafone Idea has to pay around Rs 10,000 crore to Indus. The Rs 2,000 crore from Vodafone Group could go towards clearing these past dues. Further, Vi is looking to raise another Rs 25,000 crore in debt through lenders.
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The telco can pay Indus Towers substantially with the raised amount. The money raised through equity has been earmarked for capex or capital expenditures. Vi wants to improve the network coverage and network capacity. To that extent, Vi purchased spectrum in the 900 MHz band in several circles to improve indoor coverage for consumers. The money that the telco has raised will definitely help it in investing in networks, but what will be crucial to oversee will be when Vi is launching 5G.
