Internal discussions moved towards stake sale after the promoters were “unsuccessful” in raising the required funds from financial investors (Image Source: Reuters)
Vodafone Idea share price continues to crash and was down Rs 0.60, or 9.95 percent, in the morning trade on August 5. The share has crashed almost 30 percent in the last two days following a series of negative news.
On August 5, there were pending sell orders of 35,492,800 shares, with no buyers available.
Vodafone Idea share price has been in focus after Vodafone Chief Executive Officer Nick Read said the telecom major will not be infusing fresh equity into debt-ridden Vodafone Idea (Vi). Read made the comments during a conference call with investors on July 23, Business Standard reported.
"We as a group try to provide them as much practical support as we can but I want to make it very clear, we are not putting any additional equity into India," he was quoted as saying by the publication.
Also read: As Vodafone Idea struggles to stay afloat, banks to discuss next course of action
Following the news, lenders to Vodafone Idea (Vi) are expected to hold talks to decide on action with regard to their exposure to the debt-laden telecom player that is struggling to stay afloat.
This comes in the wake of Aditya Birla Group Chairman Kumar Mangalam Birla offering to hand over his stake in Vi to the government or any other entity so that the company remains functional.
Birla on August 4 stepped down as non-executive director and non-executive chairman of Vodafone Idea.
SS Mallikarjuna Rao, MD and CEO of Punjab National Bank, had a day earlier said the developments in the last few days worrying for the banking industry. He was referring to adjusted gross revenue (AGR) issues facing telecom players.
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The Supreme Court in late July dismissed applications by telcos for recalculation of AGR-related dues. According to official data, Vi 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.
In a letter to Cabinet Secretary Rajiv Gauba in June, Birla, who holds around 27 percent stake in Vi, said investors are were to invest in the company in the absence of clarity on AGR liability, adequate moratorium on spectrum payments and most importantly, floor pricing regime being above the cost of service.Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol advises users to check with certified experts before taking any investment decisions.