hi INDiA Copyright 2022
New Delhi, January 13
After Vodafone Idea Limited (VIL) shares crashed as alarmed investors dumped shares on news that the Central Government could hold its equity, a senior company official said Government may not appoint anyone on the board of directors and that the current promoters will manage and run the company.
VIL Managing Director and CEO Ravindra Takkar said in the online briefing with investors that the VIL has decided to convert interest dues of over Rs 15,000 crore to the government into equity, which would mean about 35.8 per cent stake in the company. If the government accepts the offer in full, it will become one of the largest shareholders of VIL. The holding of the promoters, Vodafone Group, would then be around 28.5 per cent with Aditya Birla Group holding 17.8 per cent of the stake.
The VIL MD contended that DoT’s letter regarding the option of converting interest on the dues into equity does not contain any condition that seeks to place the government on the board of directors. He went on to assert that VIL will remain an independent entity because the government does not want a duopoly and would like at least three private companies in the market.
The entire process is expected to be completed in the coming months, he added. “Given that most of the company’s debt liability is towards the government. It was clear to us that converting some of the debt into equity is a good option for the company to reduce its debt burden,” he said.