close
close

Vodafone Group sells 18% stake in Indus Towers for ₹15,300 crore; the proceeds do not go to Vodafone Idea

New Delhi: Britain’s Vodafone Group Plc is selling an 18% stake in Indus Towers on Wednesday Rs 15,300 crore is unlikely to benefit India’s Vodafone Idea arm as proceeds from the sale would be used to pay the parent company’s lenders, two people aware of the details said.

New Delhi: Britain’s Vodafone Group Plc is selling an 18% stake in Indus Towers on Wednesday Rs 15,300 crore is unlikely to benefit India’s Vodafone Idea arm as proceeds from the sale would be used to pay the parent company’s lenders, two people aware of the details said.

Vodafone Group Plc had pledged shares of Indus Towers with its bankers against investments to finance its India operations, at the time of the Vodafone India-Idea Cellular merger in 2017, amounting to about $2 billion, the people cited above said on condition of anonymity.

Premium benefits



  • 35+ Premium articles every day



  • Specially formulated Newsletters every day



  • Access 15+ print edition articles every day



  • Only for webinar subscribers by specialized journalists



  • E Paper, Archive, select The Wall Street Journal & The Economist articles



  • Access to exclusive offers for subscribers: Infographics I Podcasts

Unlock 35+ well researched
premium items every day

Access global insights with
100+ exclusive items from
international publications

5+ newsletters for subscribers only
specially compiled by experts

Free access to e-paper and
WhatsApp updates

Vodafone Group Plc had pledged shares of Indus Towers to its bankers against investments to finance its India operations, at the time of the Vodafone India-Idea Cellular merger in 2017, amounting to about $2 billion, the people cited above said on condition of anonymity.

In a statement on Wednesday, the British carrier said: “The placement has raised INR 153.0 billion (€1.7 billion) in gross proceeds, which will be used to repay Vodafone’s existing lenders substantially in proportion to the outstanding bank loans of €1.8 billion secured by Vodafone’s loans. Indian Possessions.”

“Of the money they raised from the sale, most of it goes to paying the bankers,” said one of the people mentioned earlier. from Vodafone Idea.”

According to Vodafone Group’s 2023 annual report, the telecom provider had €1.5 billion in outstanding bank loans from lenders, backed by Indian assets including Vodafone Idea.

The British airline’s total stake in Indus Towers has been reduced from 21.5% to 3.1% after it sold 484.7 million shares through an accelerated bookbuild offer.

No benefit from FPO either

Vodafone Idea, a key customer of India’s largest telecom tower provider Indus Towers, has come forward 18,000 crore in India’s largest follow-on offer (FPO) in April.

However, the telco CEO Akshaya Moondra had said at the time that Vodafone Idea cannot use the proceeds to pay Indus Towers’ dues as the latter was a promoter company. Vodafone Idea owes an estimated debt 10,000 crore to Indus Towers.

Who bought, who sold shares in the block deal

According to National Stock Exchange (NSE) data, SBI Mutual Fund and Bharti Airtel are among the bigger buyers, with the former buying over 35 million shares worth 1,117 crore.

Bharti Airtel, the largest shareholder of Indus Towers with a 47.95% stake, bought 1% or 26.95 million shares for 860 crore, increasing its stake to 48.95%.

Buyers also included Ghisallo Capital Management LLC, Kotak Securities Limited and Authum Investment and Infrastructure Limited, which bought 0.73%, 0.54% and 0.55% respectively.

The entities that sold the stake included Vodafone Group’s wholly owned indirect subsidiaries, Euro Pacific Securities Ltd, CCII (Mauritius), Inc; Asian Telecommunications Investments (Mauritius) Ltd; Trans Crystal Ltd; Mobilvest; Prime Metals Ltd; Vodafone Telecommunications (India) Limited; and Al-Amin Investments Ltd.

Vodafone Group had on Tuesday said it planned to sell 9.94% stake in Indus Towers through a bulk sale at a price band of 310- 341 per share, valuing the sale between $996 million and $1.1 billion.

However, the size of the stock sale rose to 18% on Wednesday morning, with the value of the stock sale rising to $1.8-1.9 billion.

Mint reported on Tuesday that private equity (PE) firm I Squared Capital and alternative investment firm Stonepeak would be in contention as buyers.

Buyers in the block deal have a 90-day lock-in period. Morgan Stanley, Bank of America, BNP Paribas and Jefferies executed the block deal.

Earlier, in February this year, private equity firm KKR and Canadian fund CPPIB also sold their entire stake in Indus Towers.

KKR entity Silverview Portfolio Investments Pte Ltd sold 130.8 million shares, or 4.85%, at 210.21 each, added together 2,749.61 crore. CPPIB sold 2.14% 212.15 each, added together 1,223.46 crore.

In 2022, Vodafone Group sold over 7% in Indus Towers, of which 4.7% was acquired by Bharti Airtel. The proceeds went to Vodafone Idea to reduce its debt. Currently, Vodafone Idea’s total debt is well over 2.1 trillion.

On Wednesday on the BSE, Vodafone Idea shares closed 0.36% higher 16.92; Indus Towers closed 2.88% lower 334; and Bharti Airtel closed 2.49% lower 1,393.15.

View all company news and updates on Live Mint. Download the Mint News app for daily market updates and live business news.