Vodafone Idea, the worst of the financially strapped telecom operators has finally come out in the public regarding its poor financial standing. However, what’s different about the latest move from Vodafone Idea is that it is not pleading with investors now, but with the government. Kumar Mangalam Birla, the billionaire whose company, Aditya Birla Group (ABG) holds around 27% share in the telecom company has shown interest in offloading his stake to any private or public company which might be interested in the deal. This shows Birla’s concerns about the telecom company going under, and his readiness to let the stake go so that the entity can remain as a “going concern”.
Vodafone Idea’s Fundraising Plans Remain Cold
We have been seeing Vodafone Idea’s attempt at fundraising ongoing since last year. In September 2020, Vodafone Idea announced that it would be raising Rs 25,000 crore by means of rights issues and by the way of debt. However, these plans have not materialised yet. The more recent talks between Apollo Global Management and the telco also seem to be falling apart. As per the last update, Vodafone Idea was on the stage of finalising terms, but it seems even those plans have not resorted to any conclusion. Now in a climactic fashion, Birla has remarked about settling his stake with the public and private entity as per the latest ET Telecom report.
Birla Writers Letter to Cabinet Secy
Kumar Birla in a letter to Cabinet Secretary, Rajiv Gauba, remarked that it is with a sense of urgency that he will be willing to explore all options to keep the company going and to strengthen it. He also sought clarity on the demands that Vodafone Idea has been making for long, on the issues of AGR dues, spectrum dues, and floor pricing. Out of these three, Birla put a lot of emphasis on the floor pricing regime, which if implemented would immensely help the telco and might also be the aphrodisiac when it comes to saving the company’s finances. The letter was dated June 7 and said that if no help comes from the government, then Vodafone Idea’s finances might be tainted beyond repair by July 21.