Vodafone Idea said on Friday it would raise up to Rs 25,000 crore ($3.41 billion) in fresh capital as the telecom operator tries to pay off the hefty dues it owes to the government. The loss-making carrier has been ordered by the country’s top court to pay roughly Rs 50,000 crore ($6.81 billion) in dues to the government over a 10-year period and it has so far paid Rs 7,854 crore. Vodafone said it would raise up to Rs 15,000 crore through debentures and an equal amount by issuing shares and warrants, but together will not exceed Rs 25,000 crore.
The plan to raise fresh capital also comes as the country’s third largest telecom operator grapples with an erosion in subscriber base due to a price war triggered by Reliance Industries’ telecoms venture, Jio Infocomm.
Vodafone lost 4.7 million subscribers in May alone, data from the country’s telecom regulator showed, while its gross debt stood at Rs 1.19 lakh crore as of June-end.
The joint venture between Britain’s Vodafone Plc and Idea Cellular had last month reported its eight straight quarterly loss and unveiled a plan to reduce costs by Rs 4,000 crore a year over 18 months.