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It is reported that the Indian government has given the order to Vodafone Idea to convert all the interest due to its government into equity shares in the company, making it the most significant stakeholder in the troubled telecom company.
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Vodafone claimed it was directed to convert capital of approximately $2 billion to equity.
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The company “will take all necessary actions forthwith to undertake the aforesaid issuance,” Vodafone Idea disclosed (PDF) in a regulatory filing.
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The latest move comes in the efforts for Vodafone Idea, a joint venture between a British company that owns the telecom Vodafone Group and local billionaire Kumar Mangalam Birla's conglomerate, which due to the Indian government nearly $2 billion in the spectrum and other charges.
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In 2021 the Indian government approved a bailout package for telecom companies in debt in the country.
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They also set aside rights to convert their interest into equity later on.
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In 2000 Vodafone Idea's board of directors approved a plan to grant the Indian government 36% ownership of the company.
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The company later announced that the following days' the Indian government was not interested in assuming the firm's operation.