Vodafone Idea's Strategic Move to Retain Control

Debt-laden Vodafone Idea Ltd (Vi) has announced a pivotal decision to amend its shareholders' agreement. This amendment aims to ensure that the promoters, Aditya Birla Group and Vodafone Group, retain governance and management rights, despite the Indian government's stake escalating to 48.99%.

Key Amendments and Shareholder Approval

The board's approval on May 2, 2025, includes revising the 'Qualifying Threshold' from 13% to 10% and excluding the government’s equity from governance calculations. An Extraordinary General Meeting (EGM) on June 3 will seek shareholder approval for these changes.

Impact on Promoters and Government Stake

Following the conversion of dues worth Rs 36,950 crore into equity, the government's shareholding surged to 48.99%. Meanwhile, promoter stakes stand at 9.5% for Aditya Birla Group and 16.07% for Vodafone Group. The amendment ensures promoters can continue appointing directors and key executives.

Financial Overview and Future Steps

Vi’s total debt reached Rs 2.17 lakh crore in the December 2024 quarter, with Rs 2.14 lakh crore owed to the government. This restructuring is crucial for maintaining operational continuity under promoter leadership, despite the government being the largest shareholder.