Vodafone Idea board clears shareholder pact amendment
Vodafone Idea
Friday said its board has cleared amending the shareholders' agreement to allow promoters Aditya Birla Group and Vodafone Group to retain governance and management rights in the company.
'The Board of Directors at its meeting held today i.e. on 2 May 2025 have inter-alia resolved to...amend certain clauses of the Shareholders' Agreement (to which the Company is a party) so as to modify, amongst others, the 'Qualifying Threshold' from 13% to 10% and, solely for this purpose, to disregard the equity shares originally issued to the Government of India,' Vi said in a filing to the BSE Friday.
The need for the amendment arose after an increase in the government's stake to 48.99%, following a recent conversion of statutory dues into equity. As a consequence, Aditya Birla Group (ABG) companies and the Vodafone group companies' stakes were diluted to 9.50% and 16.07% respectively.
As per the shareholders' agreement, UK's Vodafone group and ABG companies – co-promoters of Vi - have certain governance and management rights, so long as the promoter group holds 13% or more of the company's equity share capital.
Thus, Vi's board has approved revising the agreement to a qualifying threshold of 10% - from 13% - so as to allow the promoter group to retain governance and management rights in the loss-making telco.
Vi will now convene an extraordinary general meeting on June 3 to seek shareholder's nod for the same, it said in a regulatory filing.
The government recently converted Vi's spectrum dues worth ₹36,950 crore into equity, which pushed its stake in the debt-laden carrier from 22.6% to 48.99%, while diluting the holdings of the ABG companies and the Vodafone group.
'Additionally, certain provisions relating to equalisation of shareholding between the Promoter Groups and creation of security over the company's shares held by them have also been amended. Also, certain redundant clauses have been deleted and pursuant to such deletion, certain other clauses referring to such deleted clauses have been amended,' the filing said.
The governance and management control will enable promoters to appoint directors on the board of the company, appoint and dismiss key employees etc.
Vodafone Idea stock ended 0.8% lower at ₹7.06 on the BSE Friday.
Earlier, the government had converted Vodafone Idea's debt of about ₹16,130 crore, comprising interest arising from deferment of AGR (adjusted gross revenue) and spectrum instalments in February 2023.
The total debt of the company increased by about 7% to ₹2.17 lakh crore in December 2024 quarter mainly on account of increase in statutory liabilities. The company recorded a total debt of ₹2,03,400 crore in December 2023 quarter.
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