Voda Idea to issue shares to clear Nokia, Ericsson dues

Debt-ridden telecom operator Vodafone Idea (VIL) will allocate shares worth £245.8 mn to key infra vendors - Nokia and Ericsson - to clear partial dues.
VIL’s board cleared the allotment of shares on a preferential basis at about 35% higher price compared to the follow-on offer price, and this comes with a lock-in of 6 months, the company said in a regulatory filing.
“The Board approved preferential allotment of about 1,660 million equity shares of face value of Rs 10 each, at an issue price of Rs 14.8 per share, for an aggregate consideration of up to £245.8 mn to… Nokia Solutions and Networks India and Ericsson India,” the filing said.
Nokia and Ericsson will participate for up to £152 mn and £93.8 mn respectively, subject to approval by VIL shareholders at the EGM to be held on July 10.
“Nokia and Ericsson both have a long-term partnership with VIL, as key suppliers of network equipment, and this preferential allotment will enable VIL to clear part of their outstanding dues,” the filing said.
Post this preferential issuance, the shareholding of Nokia and Ericsson in the company will be 1.5% and 0.9%, respectively. The cumulative shareholding of VIL promoters - Aditya Birla Group and Vodafone - will stand at 37.3%, while govt’s shareholding will come down to 23.2% and the balance 37.1% will be public shareholding.