Telecom major Vodafone Idea Limited on August 4 informed that Kumar Mangalam Birla will step down as non-executive director and non-executive chairman of the board with effect from close of business hours on August 4, 2021.
The board of directors of Vodafone -Idea Limited at its meeting has accepted the request of Birla. The board, in the meanwhile, has unanimously elected current Non-Executive Director Himanshu Kapania as the non-executive chairman of the firm.
Last month, the Aditya Birla Group chairman had written a letter to the Government of India in which he offered to hand over his stake in Vodafone-Idea (Vi) to any public sector entity considering the "looming crisis" before the telecom operator. After Birla's letter came out in public, the shares of Vi tumbled over 16 percent on August 4.
In his letter to Cabinet Secretary Rajiv Gauba, Birla had said that investors are not willing to invest in the company in the absence of clarity on adjusted gross revenue (AGR) liability, an adequate moratorium on spectrum payments and most importantly floor pricing regime above the cost of service.
"It is with a sense of duty towards the 27 crore Indians connected by VIL, I am more than willing to hand over my stake in the company to any entity- public sector/government/domestic financial entity or any other that the Government may consider worthy of keeping the company as a going concern," stated Birla, who holds around 27 percent stake in the Vi, while the telecom company's UK parent owns a 45 percent stake.
According to official data, VIL had an AGR liability of Rs 58,254 crore out of which the company has paid Rs 7,854.37 crore and Rs 50,399.63 crore is outstanding. The company has self-assessed the dues to be Rs 21,533 crore. The Supreme Court on July 23 dismissed a petition seeking re-computation of AGR dues.
Meanwhile, public sector banks like Punjab National Bank (PNB) seems concerned developments in the telecom sector over the last few days and the lack of clarity over them.
PNB Manging Director and CEO SS Mallikarjuna Rao on August 3 said that his bank will discuss with other banks the way forward following Aditya Birla Group chairman Kumar Manglam Birla’s letter to the government on offering to hand over the stake in Vodafone-Idea (Vi).
"Developments in the last few days are areas of concern for the banking industry to look at. Even SBI chairman has given a statement that considering these factors probably banks will not be willing to fund telecom companies in the absence of clarity with respect to these issues," said Rao in a conference call on August 3.
Vodafone-Idea Ltd's shares price tumbled on August 4 and closed at Rs 6.03, down by 1.37 or 18.51 percent. It has touched a 52-week low of Rs 6.03. It has touched an intraday high of Rs 7.30 and an intraday low of Rs 6.03.