Ahead of mega FPO, Vodafone Idea raises about Rs 5,400 crore from anchor investors

Vodafone Idea FPO: Vodafone Idea, whose Rs 18,000 crore follow-on public offer (FPO) is set to open on Thursday, April 18, announced the closure of its anchor book allocation on Tuesday. In an exchange filing, the telecom company said that it raised nearly Rs 5,400 crore from marquee global and domestic investors. 

Some of the notable names who subscribed to the anchor book include GQG Partners, UBS, Morgan Stanley India Investment Fund, Citigroup Global Markets Mauritius, Goldman Sachs, and Fidelity, among others.

Vodafone Idea said its Capital Raising Committee has approved the allocation of 490.9 crore equity shares of the company to the anchor investors.

"The Capital Raising Committee of the Board of Directors of the company, at its meeting held on April 16, 2024, in consultation with the Book Running Lead Managers to the issue, has finalised the allocation of 4,90,90,90,908 equity shares to anchor investors at an anchor investor allocation price of Rs 11 per equity share (including a share premium of Rs 1 per equity share)," the company said in a BSE filing.

The anchor book received interest from a large number of leading global as well as domestic investors, all at the top end of the price band, which is Rs 11 per equity share.

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Cash-strapped Vodafone Idea has announced a Rs 18,000 crore follow-on public offer at a price range of Rs 10–11 per share, marking the biggest FPO in the country.

The mega fundraise by VIL, which comes close on the heels of a Rs 2,075 crore fund infusion by the Aditya Birla Group via a preferential share issue earlier this month, is significant as it would give the ailing telco the firepower to improve competitive positioning in the Indian market, where it currently trails behind larger rivals Reliance Jio and Bharti Airtel by a wide margin.

The funds would also help VIL prepare a war chest for the much-delayed 5G rollout and strengthen 4G services.

VIL has been haemorrhaging subscribers month after month and fighting a desperate battle for survival, saddled with a debt of Rs 2.1 lakh crore and quarterly losses.

VIL's follow-on offer will open to public investors on April 18 and close on April 22. The book-running lead managers of the FPO are Axis Capital Limited, Jefferies India Private Limited, and SBI Capital Markets Limited.

Shares of the company ended 1.82 per cent lower at Rs 12.92 apiece on the BSE on Tuesday.

With PTI inputs