Indian operator Vodafone Idea (Vi) has been directed by the country’s government to convert its outstanding dues on both Adjusted Gross Revenue (AGR) and deferred spectrum payments into equity.
The Times of India reports that following the conversion – worth around INR161.3 billion (USD1.95 billion) - the government will take a 33% holding in Vi to become the operator’s largest shareholder. Business Standard reported that Vi’s share value surged by over 24% following the announcement of the government’s decision.
The reforms package that has enabled Vi’s equity conversion was first announced in September 2021. However, CommsUpdate notes that a decision on Vi’s case was held up for over a year due to a number of issues, including unstable stock prices.
Ashwini Vaishnaw, Union Minister of Communications, Electronics and Information Technology and Railways, indicated that approval was granted after the government secured a commitment from the Aditya Birla Group to both manage Vi and provide required investments. Now that these conditions have been met, the conversion has been approved.