Government may not run Vodafone Idea, says CEO

Advertisement

New Delhi, January 13

After Vodafone Idea’s (VIL) stock crashed as alarmed investors started dumping shares on the news that the Central government could hold its equity, a senior company official said the government may not appoint anyone on the Board of directors and that the current promoters will manage and run the company.

VIL managing director and chief executive officer Ravindra Takkar said in an online briefing with investors that VIL has decided to convert interest dues of over Rs 15,000 crore to the government into equity, which would mean about 35.8% stake in the company. If the government accepts the offer in full, it will become one of the largest shareholders of VIL. The holding of the promoters, Vodafone Group, would then be around 28.5% with Aditya Birla Group holding 17.8% stake.

The VIL managing director contended that the Department of Telecommunication’s letter regarding the option of converting interest on the dues into equity does not contain any condition that seeks to place the government on the Board of directors. He went on to assert that VIL will remain an independent entity because the government does not want a duopoly and would like at least three private companies in the market.

The entire process is expected to be completed in the coming months, he said.