Following the placing, Vodafone holds 82.5 million shares in Indus Towers, equivalent to a 3.1% shareholding
U.K.-based Vodafone Group announced that it has sold 484.7 million shares in Indian tower company Indus Towers, representing 18% of Indus’ share capital, through an accelerated book-build offering.
In a release, Vodafone stated that the placing raised a total of INR153 billion ($1.83 billion) in gross proceeds which will be used to substantially repay Vodafone’s existing lenders in relation to the outstanding bank borrowings of €1.8 billion ($1.93 billion) secured against Vodafone’s Indian assets.
Following the placing, Vodafone holds 82.5 million shares in Indus, equivalent to a 3.1% shareholding, the company said.
Prior to this transaction, Vodafone Group owned 21.5% of Indus Towers via various group entities. In early 2022, Vodafone sold 7.1% of its holdings in the tower firm.
Indian telco Bharti Airtel is also a large shareholder in Indus Towers, which currently has nearly 220,000 towers across India.
Private equity company KKR and Canadian fund CPPIB were also investors in Indus, but sold their entire stakes in February this year.
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Vodafone’s local unit in India, Vodafone Idea, has fallen behind in monthly payments for use of the towers owned by Indus by as much as INR100 billion. According to recent reports, Vodafone Idea accounts for about 40% of Indus Tower’s revenue.
Last week, Bharti Airte’sl Chairman Sunil Mittal urged Vodafone Idea to settle its debts with Indus Towers and said that the tower firm would not provide new services to the telco if it failed to pay.
Mittal warned that Vodafone Idea won’t be able to use Indus’ 5G towers unless the payments are made.
Vodafone Idea recently concluded its $2.16 billion follow-on public offer (FPO) and also raised about $648.5 million from 74 anchor investors. Vodafone Idea recently said it expects to use the equity and debt funding to deploy 5G technology across India within six to seven months of securing the funds; it was also seeking funds to bolster its 4G network and pay tower vendors.
Rival operators Bharti Airtel and Reliance Jio Infocomm have an extensive 4G coverage compared to Vodafone Idea. The two telcos have already completed their pan-India 5G networks.