• Send Us A Tip
  • Calling all Tech Writers
  • Advertise
TechStory
  • News
  • Crypto
  • Gadgets
  • Memes
  • Gaming
  • Cars
  • AI
  • Startups
  • Markets
  • How to
No Result
View All Result
SUBSCRIBE
TechStory
  • News
  • Crypto
  • Gadgets
  • Memes
  • Gaming
  • Cars
  • AI
  • Startups
  • Markets
  • How to
No Result
View All Result
TechStory
No Result
View All Result
Home Business

Vodafone’s stock plunged 21% after news of a government stake of 36%
This conversion will result in massive equity dilution to all existing Vodafone Idea shareholders.

Ayush Bansal by Ayush Bansal
January 13, 2022
in Business, Markets, News, Story
0
Idea, Vodafone India Announce Much Anticipated Telecom Merger!
215
SHARES
3.6k
VIEWS
TwitterWhatsappLinkedin
Vodafone Idea - Share Price News in Marathi, Latest Vodafone Idea - Share Price news, photos, videos | Zee News Marathi
Image: Zee News

Shares of Vodafone Idea (VIL) on Tuesday tumbled nearly 19% after the debt-ridden firm announced converting about ₹16,000 crore interest dues liability payable to the government into equity. The stock tanked 18.85% to ₹12.05 on both the BSE and NSE.

You might also like

Charlie Munger Dies at 99: The End of an Era in Berkshire Hathaway

Remembering Charlie Munger: A Titan of Business and Investing

YouTube Playables is OUT! – How Can You Access the Gaming Platform?

VIL has decided to opt for converting about ₹16,000 crore interest dues liability payable to the government into equity which will amount to around 35.8% stake in the company, as per a regulatory filing of the telecom firm. In such a scenario, the government will become the single largest shareholder in the telecom firm with a stake of 35.8 per cent.

An Indian government representative did not offer any immediate comments on the proposed plan. Vodafone Idea’s shares plummeted almost 21 per cent in Mumbai on Tuesday – most since March 2020. While the benchmark S&P BSE Sensex advanced 0.4 per cent.

Vodafone Idea said it has exercised the option of paying interest for the four years of deferment on the deferred spectrum installments. AGR dues by converting the NPV of such interest amount into equity in an update released before market hours.

This is against its peer Bharti Airtel which recently said it would not opt for conversion of interest on the deferred spectrum and adjusted gross revenue (AGR) dues into equity.

The net present value (NPV) of this interest is expected to be about Rs 16,000 crore as per the company’s best estimates.

“Since the average price of the company’s shares at the relevant date was below par value. The equity shares will be issued to the government at a par value of Rs 10/- per share, subject to final confirmation by the DoT. The conversion will therefore result in dilution to all the existing shareholders of the company, including the promoters,” Vodafone Idea said.

“The governance and other rights of the promoter shareholders are governed by a shareholders agreement (SHA) to which the company is a party and are also incorporated in the Articles of Association of the Company,” Vodafone said in a notice to exchanges.

“The rights are subject to a minimum qualifying threshold of 21 percent for each promoter group. In light of the conversion of interest into equity, the promoters have mutually agreed to amend the existing SHA for reducing the minimum qualifying threshold from 21 percent to 13 percent to exercise certain governing rights such as the appointment of directors and relate to the appointment of certain key officials, etc,” the company said.

Whats’s Next

“In the short term, Vodafone Idea’s price will react negatively due to equity dilution at such a low price. But eventually, as the ARPU rises, as has been the trend since the last few quarters. We expect the company to perform better in the long term,” while adding that the latest move by the government is an initiative to save the telecom industry from a duopoly.
Tags: BusinessMarketshareVodafone Idea
Tweet54SendShare15
Ayush Bansal

Ayush Bansal

Recommended For You

Charlie Munger Dies at 99: The End of an Era in Berkshire Hathaway

by Anochie Esther
November 29, 2023
0
Charlie Munger

The business world mourns the loss of Charlie Munger, the trusted confidante and right-hand man of Warren Buffett at Berkshire Hathaway. Munger, who passed away at the age...

Read more

Remembering Charlie Munger: A Titan of Business and Investing

by Anochie Esther
November 29, 2023
0
Warren Buffett

The world of business and finance is mourning the loss of a true titan—Charlie Munger, the longtime friend and business partner of Warren Buffett. Munger, who passed away...

Read more

YouTube Playables is OUT! – How Can You Access the Gaming Platform?

by Adersh Unni Krishnan
November 29, 2023
0
YouTube Playables is OUT! - How Can You Access the Gaming Platform?

Google's streaming giant, YouTube, is entering the new gaming world and has started rolling out its new gaming platform, Playables. Playables is a new platform under the gaming...

Read more
Next Post
Tata Teleservices, like Voda Idea, has decided to convert AGR dues into equity

Tata Teleservices, like Voda Idea, has decided to convert AGR dues into equity

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Nexcopy USB Duplicator

Make data loading to flash drives a simple process. Nexcopy USB Duplicator Systems.

Related News

How To Get To Bean Valley in Super Mario RPG

How To Get To Bean Valley in Super Mario RPG

November 19, 2023
Cybertruck in a showroom

Tesla Cybertruck Showroom Locations: Where to See the Electric Beast in Person

November 24, 2023
How to get Johnny Silverhand arm in ‘Cyberpunk 2077’

How to get Johnny Silverhand arm in ‘Cyberpunk 2077’

August 28, 2023
How to send a gift message on Instagram

How to send a gift message on Instagram

August 18, 2023
How To Play Naruto x Boruto Ultimate Ninja Storm Connections with Friends

How To Play Naruto x Boruto Ultimate Ninja Storm Connections with Friends

November 19, 2023
COD- Modern Warfare

Burst Assault Rifle becomes a full-auto demon in Modern Warfare 3 loadout

November 14, 2023

Techstory

Tech and Business News from around the world. Follow along for latest in the world of Tech, AI, Crypto, EVs, Business Personalities and more.
reach us at info@techstory.in

Advertise With Us

Reach out at info@techstory.in

BROWSE BY TAG

#Crypto acquisition AI amazon android Apple bitcoin Business China cryptocurrency e-commerce electric vehicles Elon Musk entrepreneurship Ethereum facebook flipkart funding Google India Instagram Investment ios iPhone IPO Market Markets Meta Microsoft News NFT Russia Social Media SpaceX startup startups tech Tech news technology Tesla TikTok trending twitter uber whatsapp

© 2023 Techstory Media Pvt Ltd

No Result
View All Result
  • News
  • Crypto
  • Gadgets
  • Memes
  • Gaming
  • Cars
  • AI
  • Startups
  • Markets
  • How to

© 2023 Techstory Media Pvt Ltd

Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?