Since the amount involved exceeds R1,200 crore, the proposal would now require the approval of the Cabinet Committee on Economic Affairs.
Vodafone will acquire 24.65% from Analjit Singh in Scorpio Beverages (SBP) and 10.97% from Piramal Enterprises. Of the R10,141 crore Vodafone would spend in hiking its stake, R8,900 crore will be paid to Piramal and R1,241 crore will be paid to Singh.
The difference in valuation between (almost one-seventh) Singh and Piramal Enterprises is due to holding company discounts and outstanding debt applicable on the former.
The current structure of Vodafone India is like this: 64.4% is held by Vodafone International Holdings BV (VIHBV), a company incorporated in the Netherlands and a subsidiary of Vodafone Group Plc, through its wholly-owned subsidiaries. CGP India Investments, an indirect shareholder in VIL and an indirect Mauritian subsidiary of VIHBV, would buy stake from Scorpio Beverages. CGP plans to acquire the 51% stake held by Analjit Singh and Neelu Analjit Singh in SBP. The balance 49% in SBP is held by CGP.
Last day to reply to conciliation proposal
Vodafone has been asked to give its final reply by Tuesday on the government proposal for a non-binding conciliation to settle the R11,200-crore tax dispute, finance minister P Chidambaram said. We have written to them recalling the promise made by the CEO when he met me that they will give a final answer in 2-3 weeks. I think we have told them to give us the final answer by 31 December, Chidambaram said in a TV interview. PTI