The ₹25,000-crore rights issue of Vodafone Idea Limited, one of India’s largest telecommunications firms, opens on Wednesday.
The telecom major would issue up to 2,000 crore fully paid-up equity shares (face value ₹10 each) at a price of ₹12.50 per share aggregating to ₹25,000 crore by way of rights issue to eligible equity shareholders.
“The rights entitlement is determined as 87 equity shares for 38 equity shares held by eligible equity shareholders. The last date for request of split application forms is April 17. The rights issue will close on April 24, 2019,” said the company.
The promoter-shareholders, Vodafone Group and Aditya Birla Group, have confirmed their participation of up to ₹11,000 crore and ₹7,250 crore respectively in the issue.
“Furthermore, certain promoter and promoter- group shareholders have also indicated that, in case the rights issue is undersubscribed, they reserve the right to subscribe to part or the whole amount of the unsubscribed portion, subject to applicable laws,” said the statement.
Commenting on the rights issue, Balesh Sharma, CEO Vodafone Idea limited, said “Our top priority is to integrate quickly to improve customer experience and profitability. We believe that the expanding coverage and increasing capacity will enable us to offer a superior network experience to our customers, enhance our ability to add more broadband customers and improve profitability by reducing costs and delivering synergies.”
Vodafone Idea with 387.2 million subscribers and a revenue market share of approximately 32% of the Indian mobile telecommunications services industry, posted a loss of more than ₹5,000 crore each in the September and December quarters.
“We believe that the proceeds from the rights issue coupled with the monetisation of our stake in Indus Towers Limited will allow us to make the required investments in the business to achieve our strategic goals. With strong assets such as two leading brands, ‘Vodafone’ and ‘Idea,’ the largest spectrum portfolio and a well-invested network, we are well-placed to exploit the growth opportunities ahead of us,” Mr. Sharma added.
Vodafone Idea shares on BSE closed down 1.74% at ₹16.9 in a firm Mumbai market on Tuesday.
