The Government of India is set to increase its stake in Vodafone Idea Ltd (Vi) to around 48.99% after conversion of spectrum auction dues into equity shares, the company revealed today, March 30. The move is in line with the telecom sector relief package announced in September 2021.
In an order issued on March 29, the Ministry of Communications directed Vodafone Idea to issue equity shares worth ₹36,950 crore to the government under Section 62(4) of the Companies Act, 2013. The company received this notification today and has to complete the issuance process within 30 days, subject to approval from relevant authorities, including the Securities and Exchange Board of India (SEBI).
The allotment will involve issuance of 3,695 crore equity shares with a face value of ₹10 each at an issue price of ₹10 per share. The pricing has been determined based on the volume-weighted price of the last 90 business days or the last 10 business days before February 26, 2025, whichever is higher, as per Section 53 of the Companies Act, which prohibits the issuance of shares at less than their par value.
Following this transaction, the government’s stake in Vodafone Idea will increase from 22.60% to around 48.99%. However, the company assured that the promoters will retain operational control.
Vodafone Idea said, “The company will take all necessary steps to issue shares upon receipt of the requisite approvals.”
