Vodafone Idea taps ₹5,400 Crore funding from anchors

18 Apr 2024 , 11:28 AM

Vodafone Idea's ₹5,400 Crore share offer to anchor investors was completely subscribed on Tuesday, making it India's third-largest anchor book, behind One 97 Communications and Life Insurance Corporation.

Telecom Minister Ashwini Vaishnaw and Finance Secretary TV Somanathan have endorsed the cash-strapped telco's fundraising attempts.

As per the exchange filing, the telecom company has distributed 491 crore shares to 74 anchor investors at a price of ₹11 per share, resulting in a total of ₹5,400 crore raised.

International institutional investors like GQG Partners, UBS, AustralianSuper, Fidelity, Redwheel Funds, Abu Dhabi Investment Authority, Allspring Global Investments, Morgan Stanley Investment Funds, Government Pension Fund Global, Copthall Mauritius Investment, and Societe Generale were some of the participants who subscribed to the telecom company's initial book offering.

Domestic mutual funds like as HDFC, Quant, Motilal Oswal, Baroda BNP Paribas, and 360 One were also major investors. Rajiv Jain's GQG Partners, through numerous entities, has invested roughly ₹1350 Crore in Vi's anchor book.

The Indian government, which owns 32% of Vodafone Idea (Vi), expressed complete support for the carrier's fundraising efforts on Tuesday. The offering comprises a follow-on public offer to raise ₹18,000 Crore at ₹10-11 per share, as well as a preferential issuance of ₹2,075 Crore at ₹14.87 per share to one of the company's founders. This would be followed by ₹25,000 Crore in debt finance.

According to market analysts, the strong anchor lineup indicates that both high-net-worth people and mainstream investors would buy the issue. "We are definitely looking at a good subscription to the FPO," a Mumbai-based brokerage analyst stated.

The government's move to convert the telco's liabilities into equity has boosted investor confidence, which would help the company's much-needed fundraising projects, chief executive Akshaya Moondra said on Monday.

The present ₹18,000-Crore follow-on share offer will reduce the government holding to 24%, which might grow to a comfortable 32-33% if the Centre decides to convert part of the principle dues into additional equity, he said.

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