Post conversion, the government will hold around 35.8 percent in the company. Promoter shareholders will hold around 28.5 percent post conversion into equity.
Telecom operator Vodafone Idea board has approved deferment of spectrum action installments due up to 4 years. The board has also approved conversion of interest on spectrum auction installments and Adjusted Gross Revenue (AGR) dues into equity.
The conversion to equity will result in dilution to all existing shareholders including promoters. Post conversion, the government will hold around 35.8 percent in Vodafone Idea. Promoter shareholders will hold around 28.5 percent post conversion into equity.
The promoters will amend existing shareholders agreement (SHA) to reduce minimum qualifying threshold to 13 percent from 21 percent. Vodafone will hold 28.5 percent and AB Group will hold 17.8 percent after conversion of interest to equity.
The net present value of interest on spectrum auction and AGR is expected to be about Rs 16,000 crore.
The equity shares will be issued to the government at Rs 10 per share after confirmation by the Department of Telecommunications (DoT).
"The Net Present Value (NPV) of this interest is expected to be about Rs 16,000 crore as per the company’s best estimates, subject to confirmation by the DoT. Since the average price of the company’s shares at the relevant date of 14.08.2021 was below par value, the equity shares will be issued to the government at par value of Rs 10 per share, subject to final confirmation by the DoT," the company said in a statement.
(Edited by : Anshul)
First Published: IST