Vodafone Idea recently said it expects to use the equity and debt funding to deploy its 5G service within six to seven months of securing the funds
Indian operator Vodafone Idea said it has concluded its $2.16 billion follow-on public offer (FPO), which closed successfully on Monday.
The carrier said that its FPO has been subscribed 7 times, with strong demand from global institutional investors. The telco said that allotment for qualified institutional buyers (QIBs) was subscribed 19.3 times, of which 82% of bids came from foreign institutional investors. Also, the non-institutional investor (NII) portion got bids for 4.5 times the shares set aside for them. The retail segment was fully subscribed. The offer, which had opened on April 18, is part of a broader funding program to guarantee the financial survival of the company.
According to published reports, GQG, Capital Group, Morgan Stanley, Fidelity Investments, Blackrock and Citadel were among the investors who subscribed to the issue during the three-day bidding period.
Vodafone Idea has also recently raised about $648.5 million from 74 anchor investors. Foreign institutional investors such as UBS, AustralianSuper, Fidelity, Redwheel Funds, Abu Dhabi Investment Authority, Allspring Global Investments, Morgan Stanley Investment Funds, Government Pension Fund Global, Copthall Mauritius Investment, and Societe Generale were among the firms that subscribed to the anchor book.
The Indian government is currently the largest shareholder in Vodafone Idea, with a stake of over 33%. However, this stake is set to decline to 23% because the government didn’t participate in the FPO, according to published reports.
Vodafone Idea recently said it expects to use the equity and debt funding to deploy its 5G service across India within six to seven months of securing the funds; it was also seeking funds to bolster its 4G network and pay tower vendors.
Rival operators Bharti Airtel and Reliance Jio Infocomm already provide 5G services across the country. The two telcos initially launched 5G services in October 2022.
Vodafone Idea expects 5G technology to account for nearly 40% of its overall revenues in 24-to-30 months, according to recent press reports. This goal implies that Vodafone Idea will target 5G coverage in roughly the top 100 cities and towns that generate 40% of its current revenues, a company spokesperson said.
The operator has recently completed its minimum rollout obligation towards 5G deployments in four telecom circles in India. In a presentation for investors, Vodafone Idea, which is a joint venture between U.K. carrier Vodafone and India’s Aditya Birla Group, said its delayed entry into India’s 5G race would help it access the latest advances in 5G technology in a cost-efficient way.
The Indian telco also noted that 90% of its radio gear is already 5G-ready. During the presentation, the carrier also announced plans to refarm its airwaves in the 900 MHz and 2.1 GHz bands as part of plans to expand the telco’s 4G coverage in its 17 priority markets across India.
U.S.-based Open RAN (O-RAN) provider Mavenir recently said it expects to secure a commercial agreement from Vodafone Idea for the deployment of the latter’s 5G network by the end of the year.
