Vodafone exits Indus Towers by selling shares worth Rs 2,800 crore. Details here

UK-based Vodafone Group Plc (Vodafone) said it sold the remaining 3 per cent stake in domestic telecom infrastructure firm Indus Towers for Rs 2,800 crore. "Vodafone announces that it has successfully completed the placing of its remaining 7.92 crore shares in Indus Towers Ltd (Indus) representing 3 per cent of Indus' outstanding share capital through an accelerated book build offering (the placing) on December 5, 2024," it stated in an exchange filing on Friday.

"The placing raised Rs 2,800 crore ($330 million) in proceeds, of which Rs 890 crore ($105 million) has been used to fully repay outstanding borrowings to Vodafone's existing lenders, secured against Vodafone's Indian assets and settle transaction fees," the British telecom major added.

Vodafone mentioned that residual proceeds of Rs 1,910 crore ($225 million) have been used to acquire 1.7 billion equity shares in Vodafone Idea Ltd (VIL) through a preferential allotment of shares (capital raise), increasing the British telco's shareholding in VIL to 24.39 per cent (from earlier 22.56 per cent).

"VIL has used the proceeds from this capital raise to pay outstanding Master Service Agreement (MSA) dues to Indus. Following this, Vodafone's obligations to Indus under the Security Arrangements3 have now been satisfied in full," the UK firm further stated.

VIL is currently involved in the process of rolling out its 5G services in select areas. The company was formed in 2018 when Vodafone Group merged its India business with Idea Cellular.

On the stock-specific front, Vodafone Idea shares settled 2.27 per cent lower at Rs 7.75. Around 4.21 crore shares changed hands on BSE today. The figure was lower than the two-week average volume of 4.88 crore shares. Turnover on the counter came at Rs 32.75 crore, commanding a market capitalisation (m-cap) of Rs 54,017.36 crore.

For the December quarter (Q3 FY25), Centrum Broking expects VIL to report a net loss of Rs 7,129 crore, which would be lower than Rs 7,741 crore in the same quarter last year. Losses for the September quarter (Q2 FY25) stood at Rs 7,275 crore. Revenue in Q3 FY25 may rise 5 per cent YoY to Rs 11,206 crore.

It believes the management commentary on its ongoing capex activity would be key to watch out for going ahead.