Vodafone Idea rights issue entitlement worth about Rs 2,000 crore renounced by Malaysia-based Axiata Group was fully subscribed on Friday on strong demand, a senior company official said Monday. 

COMMERCIAL BREAK
SCROLL TO CONTINUE READING

"Axiata renunciation was fully subscribed on strong demand," Vodafone Idea Chief Financial Officer Akshaya Moondra told PTI.

Axiata held 8.1 per cent stake in Vodafone Idea before the Rs 25,000 crore rights issue started on April 10.

"It was subscribed by both existing and new investors. Existing shareholder buying renunciation is a positive sign," Moondra said.

Axiata held 71.2 crore shares, and in the ongoing rights issue, it was entitled to subscribe 163 crore shares worth about Rs 2,000 crore.

According to a JM Financial report, minority shareholders will need to make an investment of at least Rs 5,410 crore in the rights issue to keep promoters holding at 75 per cent, to comply with the SEBI norms.

Vodafone Idea's rights issue opened on April 10 at a price of Rs 12.50 per equity share and is slated to close on April 24.

Promoter shareholders -- Vodafone Group and Aditya Birla Group -- have reiterated to the board that they intend to contribute up to Rs 11,000 crore and up to Rs 7,250 crore, respectively, amounting to a total of Rs 18,250 crore, as part of the rights issue. 

The total shareholding of Axiata after the rights issue is expected to come down to around 2 per cent. 

Vodafone Idea is looking to invest proceeds from the rights issue, Indus Tower stake sale and partial sale of the optical fibre in telecom networks to expand 4G coverage from 61 per cent population at present to over 85 per cent population coverage by March 2020.