The shares of Vodafone Idea hit an intraday high of Rs 8.60 before closing at Rs 8.25 on Monday, signalling a 20.4 per cent hike from its last closing price. The surge in the telecom company’s scrip came after the government approved conversion of over Rs 16,133 crore interest dues of the debt-ridden company into equity on Friday.
The telecom firm informed via a regulatory filing, "The total amount to be converted into equity shares is Rs 16133,18,48,990. The Company has been directed to issue 1613,31,84,899 equity shares of the face value of Rs 10 each at an issue price of Rs 10 each," the filing added.
After the conversion, which will take place at the price Rs 10 per share, the government will have a 33 per cent stake, making it the biggest shareholder in the cash-strapped joint venture between UK’s Vodafone and Kumar Mangalam Birla’s Aditya Birla Group.
Regarding the government’s stake in the telecom company, DIPAM secretary Tuhin Kanta Pandey said, “We will not have any Board seat. Our holding will be classified as public shareholding.”
The shares of Indus Towers also surged 13.47 per cent on Monday to close at Rs 160, in hopes of the tower company receiving its dues from Vodafone Idea. Indus Towers, who is India's leading provider of passive telecom infrastructure, had previously asked Vodafone Idea to make its payments on time because the tower company is also running short on cash.
