The leading telecom Operator Vodafone is going to invest a huge amount in June. Vodafone plans to invest 1 billion euro (Rs 8,000 crore) in the proposed joint venture with the Idea Cellular. Then Why Vodafone to invest Rs 8,000 crore in India in June?
The Vodafone will look at monetizing make an additional investment in India in Indus Towers. Aditya Birla group also decides to put some additional fund in this proposal to merge with Vodafone Idea Limited.
Vodafone Chief Financial Officer Nick read said, there currently estimate to invest up to 8,000 crores into India, at closing in June 2018,”.
The Vodafone will merge with Idea. They are waiting for the government approval and the British firm expects 47.5% stake. The merger of Vodafone and Idea will be largest telecom operator in India. They will have around 430 million subscriber base.
The British telecom operator has 42 percent stake in Indus Towers. Indus Towers is India’s largest mobile tower firm. During 2017-18, Indus Towers has paid dividends of 138 million euro to the Vodafone Group.
Vodafone, Bharti Airtel Limited, and Idea announced the merger of Indus Towers into Bharti Infratel On April 25, 2018.
Bharti Airtel and Vodafone, both will control the combined company jointly and Vodafone will be issued 783.1 million new shares in the combined company, in exchange for its shareholding in Indus Towers.
On a pro-forma basis, Vodafone’s financial leverage is currently high.
The Indus Tower -Bharti Infratel deal has given Idea Group to sell its full 11.15 percent shareholding in Indus Towers for cash which would be equivalent to a 29.4 percent shareholding in the combined company.
Vodafone to invest Rs 8,000 crore in India in June. Let’s wait and see what is the impact of this big deal to Indian customers? Will the plans will be cheaper with this big investment of Vodafone?