UK’s Vodafone Group Plc is selling its remaining 3% stake in Indus Towers in an over $300-million block deal and fully exiting the Indian tower company, which is now a Bharti Airtel subsidiary.
The Indus stake sale proceeds will initially be used to clear the UK carrier’s $101 million outstanding borrowings to existing lenders, secured against Vodafone’s Indian assets, the British carrier said.
Thereafter, Vodafone will use the remaining proceeds (around $200 million) to infuse fresh equity into Vodafone Idea (Vi) – its Indian telecom JV with the Aditya Birla Group – to help the latter clear a portion of its old dues to Indus Towers.
Debt-laden Vi had cleared ₹2,328.2 crore of its old dues to Indus till the quarter ended September, 2024. But Vi’s total dues to Indus are still sizeable, estimated at around ₹7,075 crore, industry executives aware said.
“Vodafone Group Plc announces that it has launched a ‘placing’ of its remaining 79.2 million shares in Indus, and such shares, representing 3% of Indus’ outstanding share capital through an accelerated book-build offering,” the British telco said in an official statement on Wednesday.
The selling Vodafone promoter entities are Omega Telecom Holdings and Usha Martin Telematics, the UK telco added.
Vodafone intends to also contribute the residual proceeds from the ‘placing’ towards an issue of new equity shares by Vi, once the terms of such a capital raise have been evaluated and decided on by Vi’s board. “The proceeds from the capital raise would be used by Vi to pay outstanding master service agreement (MSA) dues to Indus,” the UK carrier added.
Senior industry executives and bankers hinted that Sunil Mittal-led Airtel could be a potential buyer of Vodafone UK’s remaining shares in Indus. The British carrier is learnt to have been in talks with Airtel to sell these shares for some time. Earlier discussions between both parties had got mired over valuation differences, but the latest talks could yield results, they added.
In October 2024, the Competition Commission of India had cleared Airtel’s proposal to increase its stake Indus. At present, Airtel owns 50.005% in the tower company. Last month, UK’s Vodafone had classified its 3% stake in Indus as an “other investment”.
Source: Economic Times