Weeks after Mukesh Ambani’s Jio secured more than $10 billion in investment from Facebook and few US-based private equity groups, Google is said to be exploring an investment in Vodafone Idea, the Financial Times has reported.
The move could potentially pit the search giant against Facebook for the world’s fastest-growing mobile market.
Google is reportedly considering to buy a stake of about 5 per cent in Vodafone Idea, a partnership between the UK telecom company and India’s Aditya Birla Group that has been under severe financial strain. For Vodafone Idea — the product of a 2018 merger between Vodafone and Birla’s Idea —an investment by Google could boost the likelihood of its survival. Its future has been uncertain since the Supreme Court ruled in October that it owed billions of dollars in retrospective fees, prompting Birla to state it might “shut shop” altogether.
Vodafone Idea has Rs 58,254 crore as AGR dues of which it has already paid Rs. 6,854 crores to the Department of Telecommunications (DoT) in three tranches last month, or its full principal dues as per its self-assessment.
Vodafone Group is reportedly putting in funds into the JV to deal with operational requirements including settle AGR dues and take on deep pocket rivals. The infusion will see the JV’s parent pitching in $200-225 million, while the rest, about $125-$150 million, might come from their JV partner, predominantly through the private entities of chairman Kumar Mangalam Birla. The contributions are likely to be in the form of preference capital or redeemable preference shares.
Source: The Economic Times