Shareholders of indebted telecom operator Vodafone Idea have approved the allotment of shares worth Rs 436.21 crore to its sponsoring entity, Vodafone Group.
According to the results of the vote submitted to the stock exchanges on Friday evening, 99.94% of the shareholders of Vodafone Idea (VIL) approved the allocation of capital to the Vodafone group company Euro Pacific Securities.
The Vodafone group currently holds 58.46% of the company’s capital and the Aditya Birla group 16.53%.
The company had raised Rs 3,375 crore from Vodafone Group and Rs 1,125 crore from Aditya Birla Group in March.
VIL has been trying to raise funds in the range of Rs 20,000 to 25,000 crores from external sources for the past two years, but failed to attract any investors.
The government announced a reform package in September last year which has largely benefited Vodafone Idea.
The government allowed VIL to convert around Rs 16,100 crore of interest into around 33% stake in the company to provide cash to invest in the business.
Still, analysts said high debt and a weak balance sheet have hurt the company’s ability to invest in the network.
As of March 31, 2022, the total debt (including accrued but not due interest) of the group was Rs 1,97,878.2 crore. The company has around Rs 8,160 crore in payments due over the next 12 months, analysts said.
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