An investment from Google would help Vodafone-Idea, as the company tries to stay on its feet after the Supreme Court refused to budge on the Adjusted Gross Revenue dues.
Struggling telecom major Vodafone-Idea could see internet giant Google invest in the company for a 5% equity stake, the Financial Times reported citing unidentified sources. The investment would help Vodafone-Idea, as the company tries to stay on its feet after the Supreme Court refused to budge on the Adjusted Gross Revenue (AGR) dues. If successful, the deal will put Google and Facebook in the same ring to battle it out for supremacy in India’s growing mobile internet market. Facebook, earlier this month, agreed to invest Rs 43,574 crore in Mukesh Ambani’s Jio Platforms for a 10% stake.
The report said Google is considering to pick a 5% stake in Vodafone-Idea, which is a joint venture between United Kingdom-based Vodafone and India’s Aditya Birla Group. However, the talks are said to be in a very early stage. According to various reports, Google’s parent company Alphabet has also considered investing in Jio platforms. Vodafone-Idea shares have fallen 56% over the last one year. The telecom giant that emerged after the merger of Vodafone and Idea, has been asked to pay Rs 58,000 crore by the Department of Telecommunications. The firm’s self-assessment puts the AGR dues figures at Rs 21,533 crore of which the company had paid Rs 6,500 crore till the middle of March.
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In a three-way battle where Vodafone-Idea faces stiff competition from Bharti Airtel and Reliance Jio, the company has dropped to the third spot. Mukesh Ambani has roped in almost $10 billion or Rs 75,000 crore. Among investors who have picked up a stake in Jio are — Facebook, KKR, General Atlantic, Vista Equity Partners, and Silver Lake. The attractive telecom space in India which is still to chart many milestones is seeing more and more internet mobile data usage during the nation-wide lockdown.
While Vodafone has described the situation of its joint venture with the Birla Group as very critical, Kumar Mangalam Birla said the company might ‘shut shop’ after the AGR ruling by the Supreme Court. Vodafone has refused to inject more funds into the Indian venture while also writing-off the entire value of its Vodafone Idea stake, according to the report.