Vodafone's India unit plans $1.5 billion fundraising including share sales

Vodafone Group Plc’s India unit is planning to raise about $1.5 billion as it seeks to turn around its fortunes in the country’s fiercely competitive wireless market, people familiar with the matter said.

Vodafone Idea Ltd. is discussing a funding plan that could include a share sale, according to the people, who asked not to be identified because the information is private. It is working with advisers including New York-based investment bank PJT Partners Inc. as it seeks potential strategic partners to buy stakes, the people said.

The telecom operator is working to identify potential investors in the U.S., the people said. It could also raise part of the funds through other methods such as an offering of equity-linked securities, one of the people said.

Vodafone Idea plans to discuss the options at a board meeting Friday, the people said. Details of the plan are still being finalized, and the size and structure of the fundraising could change, according to the people.

Vodafone Idea fell as much as 9.9% in early trading in Mumbai on Friday amid a global stock rout. The stock rose as much as 30% on Thursday in its biggest gain since March.

Shares of Vodafone Idea have fallen about 85% since 2016 when Reliance Jio Infocomm Ltd., backed by Asia’s richest man Mukesh Ambani, pushed its way into the wireless market with free calls and cheap data packages. Representatives for PJT Partners and Vodafone Idea declined to comment.

Vodafone Idea’s fundraising plan also comes after the company won some legal relief earlier this week in a near two-decade payment dispute with the Indian government.

The joint venture between Vodafone and billionaire Kumar Mangalam Birla’s conglomerate has been weighed down by a $7.8 billion bill from the government -- biggest among peers -- eight straight quarterly losses and over $14 billion of debt.

The fine print of a Supreme Court judgment published late Tuesday showed Vodafone Idea doesn’t need to make any immediate payments as a three-judge panel allowed phone operators 10 years to pay a combined $19 billion in back fees.