We keep evaluating opportunities, no proposal before board now: VIL on Google picking stake in co
The clarification by Vodafone Idea to the BSE came a day after reports that Alphabet Inc's Google is eyeing about 5 per cent stake in the telecom company.
"As part of corporate strategy, the company constantly evaluates various opportunities for enhancing the stakeholders' value. As and when such proposals are considered by the board of directors of the company warranting disclosures, the company shall comply with the disclosure obligations," Vodafone Idea said on Friday.
Currently, there is "no proposal" as reported that is being considered at the board, it added.
"We wish to reiterate and clarify that the company will comply with Sebi Listing Regulations and duly keep the stock exchanges informed of all the price-sensitive information," it said.
Vodafone Idea's shares, which had rallied earlier on Friday, shed some of the gains after the clarification by the telecom company. The scrip ended at Rs 6.56 a share on the BSE, nearly 13 per cent higher than Thursday's close.
After the reports of Google's interest in VIL circulated, many analysts had opined that any potential investment by the global tech titan in the cash-strapped Vodafone Idea, if it materialises, will be a strategic positive for the Indian telecom operator but still inadequate to solve the telcos' debt woes.
Acquisition of a controlling stake by an outsider or a sizable equity infusion by current promoters remains the need of the hour, Credit Suisse had said in a note.
"We think unless Google (or any other external investor) looks at acquiring a controlling stake in VIL, the chances of the company's longer term survival beyond 2022-23 (when the moratorium on deferred spectrum debt ends) appear to be low," it had said.
Goldman Sachs had said that the AGR (adjusted gross revenue) situation still remains uncertain, and could potentially add as much as 50 per cent to Vodafone Idea's existing net debt of USD 14 billion. In such a scenario, the telcos' ability to generate investor interest is unclear, unless there is complete transparency on its regulatory liabilities, it had added.
Vodafone Idea has been under severe financial stress, and analysts time and again have cautioned that the company's longer-term viability remains under cloud.
VIL, where British telecom giant Vodafone holds 45 per cent stake and Aditya Birla Group is the other promoter, is staring at nearly Rs 58,000 crore in past statutory dues. These dues arose after the Supreme Court, in October last year, upheld the government's position on including revenue from non-core businesses in calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.
In March, following an approval by the Cabinet, an application was moved before the Supreme Court (on March 16, 2020) seeking its permission for the licensees impacted by the AGR judgment to pay the unpaid amount of the telecom department-calculated dues in annual instalments over 20 years.
The Indian telecom companies seem to be on radar of global investors, of late. Over the past few weeks, Jio Platforms has raised Rs 78,562 crore from marquee technology investors including Facebook, KKR, Silver Lake Partners, Vista Equity Partners and General Atlantic.
Earlier this week, Airtel's promoter firm Bharti Telecom sold 2.75 per cent stake in the company to institutional investors in the secondary market in the process raising over Rs 8,433 crore. MBI HRS