Government's Stake in Vodafone Idea Surges Amid Strategic Equity Conversion

The Indian government will elevate its ownership stake in Vodafone Idea to 48.99% by converting spectrum auction dues worth Rs 36,950 crore into equity. Currently holding a 22.6% stake, this will make the government the largest shareholder, surpassing Vodafone and Aditya Birla Group combined.

The Indian government is poised to become the largest shareholder in Vodafone Idea, as its stake will more than double to 48.99%. This comes after a decision to convert outstanding spectrum dues of Rs 36,950 crore into equity, according to a regulatory filing by the company.

The government already holds a 22.6% stake in the struggling telecom company, surpassing the combined stakes of Vodafone and Aditya Birla Group. Vodafone Idea's promoters presently own 14.76% and 22.56% of the company, respectively.

This strategic move is part of the Ministry of Communications' broader reform plan to stabilize the telecom sector, enabling Vodafone Idea to issue 3,695 crore equity shares by converting outstanding dues. The government had previously provided several reliefs, including waiving bank guarantees and converting interest dues into equity.

(With inputs from agencies.)