ALSO READIdea Cellular to raise Rs 32 bn from promoter group entities NCLT approves Idea-Vodafone merger; joint entity to have 400 mn customers Aditya Birla group set to exit fertiliser business this year Aditya Birla group's market valuation crosses $50 bn post ABCL listing Idea shareholders approve mobile business merger scheme with Vodafone India
According to a statement from Idea Cellular, equity shares were allotted at an issue price of Rs 99.50 per share including premium of Rs 89.50 per share aggregating to Rs 32.5 billion.
"This equity infusion reiterates the Group's commitment towards the telecom business and confidence in its growth prospects," Kumar Mangalam Birla, Chairman, Aditya Birla Group, was quoted as saying in the statement.
"Idea is in the process of bringing a world-class 4G network to villages, towns and cities across India that will contribute to the transition of the Indian populace towards a digital lifestyle.
"With the planned fundraiser combined with the recently announced sale of Idea's towers and potential monetisation of the Indus stake, the company will be better capitalised to participate in the growth opportunities offered by the sector."
As per the statement, the current equity infusion along with the proposed further capital raise of up to Rs 35 billion, will reduce Idea's net-debt and as a result, Vodafone's net-debt contribution to the merged entity will also be reduced by an equivalent amount.
"Additionally, the recently announced sale of Idea's and Vodafone India's standalone towers to American Tower Corp for an aggregate enterprise value of Rs 78.5 billion and the potential monetisation of Idea's 11.15 per cent stake in Indus Towers, will further augment the long-term capital resources of the company," the statement said.
"These proceeds will significantly strengthen the balance sheet of the merged entity (Idea and Vodafone India) creating a resilient entity for the future," said the statement.