As much as 20 percent equity stake in Indus Towers was sold in block deals on June 19, with UK's Vodafone Group selling around 18 percent of that stake. The deals, involving 53.30 crore shares of the mobile tower company was worth a total of Rs 17,065 crore.
Vodafone Group raised Rs 15,300 crore from the stake sale which it plans to use to repay its existing lenders. Meanwhile, the company's ownership in Indus Towers also reduced to 3.1 percent post the stake sale.
Shortly after the block deal, Bharti Airtel said that it has acquired 1 percent equity stake in Indus Towers. According to reports, private equity firms I Squared Capital and alternative investment firm Stonepeak were also among the list of buyers vying for Vodafone's stake in the mobile tower company.
The block deal not just triggered a spike in volumes in the stock but also pulled it down around 10 percent to a low of Rs 311.40 on the NSE. Volumes in the counter skyrocketed as 78 crore shares changed hands thus far, a meteoric spike from the one month daily traded average of two crore shares.
Based on the report, Abhilash Pagaria, Head – Nuvama Alternative & Quantitative Research, anticipated a float adjustment for Indus Towers in passive indices to take place in the next few days.
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He estimated a global passive flow impact of $200 million emerging out the float adjustment. As per Pagaria, an inflow of around $130 million is expected through Indus Towers' float adjustment in the MSCI index and an influx of another $65 million through the changes on the FTSE.
It was previously reported that the Vodafone Group was planning to offload a near 10 percent stake in Indus Towers in a bid to raise $1.1 million.
Last week, a Reuters report stated that Vodafone Group was looking to sell its entire $2.3 billion stake in Indus Towers through block deals as a part of a strategic move by the British firm to tackle its hefty debt.
The proceeds from this stake sale are earmarked for trimming down Vodafone's significant $42.17 billion net debt, the Reuters report added.
Currently, Vodafone holds a 21.5 percent stake in the mobile-tower operator through its various subsidiaries. Back in 2022, Vodafone announced intentions to offload its then-28 percent stake in Indus, but progress has been slow, with only a fraction sold to date.
Analysts at JPMorgan noted that the potential sale of Vodafone Group's stake in Indus Towers could generate a cash influx of $2.3 billion, facilitating faster debt repayments to vendors like Indus Towers and possibly even enabling a special dividend for the Indian tower company's shareholders.
Also Read | Vodafone PLC likely to sell Indus Towers shares worth up to $1.1 bn via block deals
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