Vodafone Idea said that India has directed the struggling telecom major to convert a portion of its dues worth Rs 16,000 crore it owes to the government into equity.
“The Ministry of Communications has directed the company to convert the NPV of the interest related to deferment of spectrum auction installments and AGR dues into equity shares to be issued to the government of India,” Vodafone Idea said in a filing.
India government will take 33 percent equity in Vodafone Idea after converting all interest related to payments for spectrum and other dues into equity.
This will make the government the largest shareholder in Vodafone Idea.
Vodafone Idea will convert dues of Rs 16,133 crore into equity and issue shares for Rs 10 each, the company informed.
“We had sought a firm commitment that the Aditya Birla Group would run the company and bring necessary investments. The Birlas have agreed and hence we have agreed to convert. We want India to be a three-player market plus BSNL and ensure healthy competition for consumers,” Telecom Minister Ashwini Vaishnaw said in a statement.