I haven’t received any communication from the government about the conversion into shares, says Vi

Vodafone Idea (Vi) said on Friday that it had not yet received any communication from the Center on the conversion of its Rs 16,130 crore of accrued interest on AGR-related deferred contributions into equity.

The conversion will effectively mean that the central government will own 33% of Vi’s capital and will become the majority shareholder of the loss-making telecommunications company.

During the FY23 second quarter earnings call with analysts, Vodafone Idea CEO Akshaya Moondra said that even he did not know why there was no communication on the conversion of the Department of Telecommunications (DoT) since April.

The conversion would potentially help the loss-making telecom company attract investors and secure funds worth Rs 20,000 crore to expand the 4G network and start 5G rollout. Vi must also pay vendor dues including Rs 7,000 crore to Indus Towers.

“I also don’t know exactly why it’s not happening. The government takes time,” Moondra said.

Vodafone had opted to convert in January and held talks with the DoT for the same. Following this, the department had sent a letter about the conversion in March 2022. Vi had agreed to the conversion, the Vi CEO added.

The reason for the delay is attributed to the fact that Vi originally opted to convert accrued interest into shares on January 11, when its shares closed at Rs 11.80 on the Bombay Stock Exchange (BSE). Since then, the share price has fallen below Rs 10 for most of FY23.

On Friday, shares of Vi closed nearly 1% lower at Rs 8.54 on BSE.

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