Home Business Sebi approves Centre's proposal to convert Vodafone Idea dues into equity: Report

Sebi approves Centre’s proposal to convert Vodafone Idea dues into equity: Report

The Centre’s stake in Vodafone may exceed 30% after the conversion. (file)

New Delhi:

India’s capital markets regulator has approved the government’s proposal to convert over $1.92 billion owed by telecom operator Vodafone Idea into equity, two senior government officials said on Thursday.

Last year, India approved a rescue package for debt-ridden telcos that allowed them to convert interest on adjusted gross revenue owed to the government into equity.

Among the three major telcos of the country, including Bharti Airtel and Reliance Industries’ Jio, the government package was seen as a relief for Vodafone Idea, which was on the verge of bankruptcy.

“SEBI (Securities and Exchange Board of India) has approved the government’s proposal to come in as a financial investor. This has been communicated to the Telecom Ministry,” an official on condition of anonymity told Reuters.

The official said the government’s stake in Vodafone could exceed 30% after the conversion, which would make it one of the largest shareholders of the company along with UK’s Vodafone Group and Aditya Birla Group.

Both the officials said Sebi has also approved the government’s request to classify its stake in Vodafone Idea as a public float.

The market regulator’s guidelines state that only up to 10% holding can be classified as public shareholding.

The ministries of finance and telecom, SEBI and Vodafone Idea did not immediately respond to a request for comments.

One of the officials said that the government will sell its stake in the telecom operator.

(Except for the title, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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