Ericsson Sells Vodafone Idea Stake – ₹428 Crore Deal
Ericsson India has offloaded its stake in vodafone Idea (Vi) for ₹428.43 crore (approximately $51.5 million) in a bulk deal. This move, which saw the sale of roughly 0.6% of Vi shares,follows a similar divestment by nokia in April. The sale of 633.7 million shares at ₹6.76 each underscores the shifting landscape in the telecom sector. The identity of the buyers remains undisclosed. The government now holds a notable stake. News Directory 3 keeps you informed on all breaking business deals. The impact of these strategic shifts is still unfolding. Notably, last year, Vodafone Idea allotted shares to Ericsson and Nokia via preferential issues to clear dues. Discover what’s next for Vodafone Idea.
Ericsson Sells Vodafone Idea Stake for $51.5 Million
Ericsson India Pvt Ltd. has sold its stake, roughly 0.6%, in Vodafone Idea (Vi) for 428.43 crore rupees, or about $51.5 million. The transaction, executed via a bulk deal on Tuesday, involved the sale of 633.7 million shares at 6.76 rupees apiece, according to data from the National Stock Exchange.
The buyers remain undisclosed.shares of Vodafone Idea closed at 6.78 rupees on the Bombay Stock Exchange (BSE) Tuesday, down 3.69%.
This Ericsson stake sale comes shortly after Nokia Solutions and Networks India Pvt Ltd sold its 0.95% stake in Vodafone Idea in late April. That deal, also a bulk transaction, generated 785.67 crore rupees, or approximately $94.5 million,from global investment banks,including Goldman Sachs. Nokia sold 102.7 crore shares at 7.65 rupees each.
Last year,vodafone Idea allotted shares to Ericsson and nokia via preferential issues to clear dues. Ericsson received 633.7 million shares at 14.80 rupees per share to settle 938 crore rupees of its debt. Similarly, nokia received 102.7 crore shares at the same price to clear about half of its 1,520 crore rupees debt.
These allotments resulted in Nokia Solutions and Networks India and Ericsson India acquiring stakes of 1.47% and 0.9% in Vodafone Idea, respectively.
A source familiar with the matter noted that the government’s increased holding in Vodafone Idea to 49% diluted Nokia and Ericsson’s stakes to around 0.95% and just under 0.6%, respectively. The government’s increased stake followed the conversion of 36,950 crore rupees of Vodafone Idea’s spectrum dues into equity shares, increasing its ownership from 22.6%.
What’s next
The government’s conversion of debt into equity is expected to reduce Vodafone Idea’s liabilities and provide some cash flow relief over the next three years, impacting its financial role in the telecom sector.