Telecom operators Vodafone Idea Ltd, Tata Teleservices Ltd and Tata Teleservices (Maharashtra) Ltd will not become PSUs after their interest payable on dues are converted into government equity
Takkar reiterated that the company's existing promoters and management will continue to be in charge of the company. There will be no government nominees on the board either.
Govt should aim to move out of Vodafone Idea quickly
The slew of reforms announced by the government have helped assuage investor concerns in the sector, and Vodafone Idea expects to continue its fundraising plans, VIL CEO Ravinder Takkar said.
The government will own 35.8 per cent in the financially-stressed firm that has agreed to convert interest on deferred statutory dues.
On Tuesday, the stock of the telecom services provider had tanked 21 per cent to Rs 11.80 after the company said it agreed to convert interest on deferred statutory dues into equity.
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A top executive at a private bank said the money that was going towards paying government dues would stay in the books and should be used for loan payment
With no duopoly, Airtel and Jio will now concentrate on improving their bottom lines rather than playing the pricing game to target Vi customers or ensure its demise
Currently, the Aditya Birla group holds around 27.7 per cent while Vodafone Group holds 44.3 per cent in the telco
The announcement of Tata Teleservices (Maharashtra) came within hours of Voda Idea also deciding to opt for converting the interest amount on AGR dues into government equity
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The broader markets were quiet today with the BSE MidCap and SmallCap indices ending little changed
Vodafone Idea continues to attract risky traders as medium-term outlook remains robust
Vodafone Idea said the equity shares will be issued to the Government at par value of Rs 10 per share, subject to final confirmation by the DoT.
This will result in dilution for all the existing shareholders of the company, including the founders
The telecom company has to take a call on the issue by Wednesday
Bharti Airtel, however, is the safer bet fundamentally among the two companies.