Shareholders of Vodafone Idea (VIL) have approved a slew of proposals, including raising its borrowing limit and issuance of securities of up to Rs 15,000 crore, according to a regulatory filing.
The shareholders’ nod came at the company’s Annual General Meeting (AGM) held on Wednesday, where various proposals — expected to enable the troubled telecom operator to pay statutory dues and stay afloat — were put up for voting.
A special resolution for increasing the borrowing powers of the company was cleared with 99.8 per cent votes, while another relating to issuance of equity securities for up to Rs 15,000 crore received 98.6 per cent votes in favour.
“All the resolutions mentioned in the AGM notice as per details…accordingly stand passed with requisite majority,” VIL said in a BSE filing on Thursday.
According to the AGM notice circulated by the company on September 7, the resolution on borrowing powers pertained to raising borrowing limit to Rs 1 trillion.
Shareholders of the company, which was earlier listed as Idea Cellular, had approved a borrowing limit of Rs 25,000 crore at its AGM in September 2014.
Other proposals that VIL shareholders approved were alteration of Articles of Association of the company, creation of security on properties and transactions with Indus Towers and Bharti Infratel.
Earlier last month, the board of Vodafone Idea had approved fund-raising plans of up to Rs 25,000 crore through a combination of equity and debt instruments, subject to shareholders’ approval.
The board’s move had come just days after the Supreme Court directed telecom operators to pay 10 per cent of their total Adjusted Gross Revenue (AGR)-related dues this year, and rest in 10 installments starting from next fiscal year.
The ambitious fundraising plans promise to throw a lifeline to cash-strapped VIL, which has suffered massive losses, has been losing subscribers and Average Revenue Per User (ARPU), and faces outstanding statutory dues of about Rs 50,000 crore.
VIL is the third-largest operator in the fiercely-competitive Indian telecom market, where Jio’s entry in 2016 with free calls and cheap data-pushed some rivals to exit or merge with other operators to stay afloat.
Jio Platforms — the unit that houses India’s youngest but largest telecom firm Jio and apps — recently raised Rs 1,52,056 crore from 13 investors, including Facebook, Google, General Atlantic, Intel Capital and Qualcomm Ventures.
Vodafone Idea’s overall AGR dues stood at over Rs 58,000 crore, of which the company has paid Rs 7,854 crore to the Department of Telecom so far.
The statutory dues arose after the Supreme Court, in October last year, upheld the government’s position on including revenue from non-core businesses in calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.
Source: Business-Standard