Vodafone Idea Shareholders Approve Raising Rs 2,458 Crore Via Preferential Issue

Vodafone Idea Ltd.'s shareholders approved raising Rs 2,458 crore through the issue of shares on a preferential basis on Thursday. The company will use the funds to clear part of its outstanding debt, expand its 4G coverage and launch 5G services, as per an exchange filing.

The board had cleared the plan on June 14 and sought shareholders' nod on raising funds.

The company will issue 166 crore shares with a face value of Rs 10 each in the preferential issue, the filing said. The issue price has been set at Rs 14.8 per share, including a premium of Rs 4.80 per share. The issue price is 35% higher than the FPO price and has a lock-in period of six months.

The telecom major will issue 102.7 crore shares at an issue price of Rs 14.80 per share, totaling Rs 1,520 crore, to Nokia Solutions and Networks India Pvt. In addition, it will issue 63.4 crore shares at the same issue price to Ericsson India Pvt., aggregating Rs 938 crore. Post this preferential issuance, the shareholding of Nokia and Ericsson in the company will be 1.5% and 0.9%, respectively.

Vodafone Idea Ltd acquired 50 MHz of spectrum worth Rs 3,510 crore in India's second 5G spectrum auction on June 27, according to a Ministry of Communication press release. Following suit with Reliance Jio Infocomm Ltd. and Bharti Airtel Ltd., the telecom giant implemented a 10-21% rate hike for both prepaid and postpaid customers, effective from July 4.

Shares of Vodafone Idea closed 0.12% lower at Rs 16.62 per share, as compared with a 0.03% decline in the NSE Nifty 50.