Vodafone Idea is gearing up to raise ₹20,000 crore from the markets through a follow-on public offer (FPO), possibly launching as early as next week, as per sources familiar with the discussions. The company has enlisted Axis Bank, Jeffries Group, and State Bank of India as lead bankers for overseeing the share sale. A price range for the FPO is expected to be determined by early next week, likely at a discount to the current share price, which closed at ₹13.36 apiece on Thursday.
Anchor investors, predominantly long-only investors, are anticipated to participate in the FPO, followed by a larger debt-raising initiative from banks. This equity fundraising marks a significant step for Vodafone Idea, which has been grappling with financial challenges in the telecom sector.
Earlier this week, shareholders approved a ₹45,000 crore fundraising plan, including the ₹20,000 crore equity infusion. Following this, the company plans to secure additional debt, bringing the total funding to ₹45,000 crore. The aim is to complete the fundraising by the end of June.
Vodafone Idea faces considerable debt and operational challenges in a competitive telecom landscape. The company’s inability to pay vendors, significant debt burden, and lag in 5G rollout compared to competitors highlight the urgency of this fundraising effort.
CEO Akshaya Moondra has emphasized ongoing discussions with external investors while affirming the commitment of promoters to inject additional equity. The board will convene to consider issuing equity or convertible securities worth up to ₹2,075 crore to promoter group entities, reflecting continued support from the promoters.
The upcoming FPO and subsequent debt raise are critical for Vodafone Idea’s financial viability and competitiveness in the telecom market.
