Vodafone Idea recently said it plans to roll out 5G services using equity and debt financing within six to seven months after securing funding.
Indian telecom operator Vodafone Idea said on Monday it had successfully completed a $2.16 billion follow-on public offering (FPO).
The company said the FPO was 7 times oversubscribed, driven by strong demand from institutional investors across the world. The Qualified Institutional Buyers (QIBs) allotment was 19.3 times oversubscribed, of which 82% was from overseas institutional investors, according to the company. The Non-Institutional Buyers (NIIs) allotment was also 4.5 times oversubscribed. The retail segment was fully booked. The offer, which was launched on April 18, is part of a broader fundraising programme to ensure the company’s financial viability.
Investors who applied for the bonds during the three-day bidding period included GQG, Capital Group, Morgan Stanley, Fidelity Investments, BlackRock and Citadel, according to published reports.
Vodafone Idea recently raised around $648.5 million from 74 anchor investors. Firms on the anchor book include international institutional investors such as UBS, Australian Super, Fidelity, RedWheel Funds, Abu Dhabi Investment Authority, Allspring Global Investments, Morgan Stanley Investment Funds, Government Pension Fund Global, Copsoll Mauritius Investment and Societe Generale.
The Indian government is currently Vodafone Idea’s largest shareholder with over 33% stake, but according to published reports, this stake is set to drop to 23% as the government did not participate in the FPO.
Vodafone Idea recently said it plans to use the equity and debt financing to roll out 5G services across India within six to seven months of securing the funding. It is also seeking funds to strengthen its 4G network and pay base station vendors.
Rival operators Bharti Airtel and Reliance Jio Infocomm are already offering 5G services across the country. Both telcos launched their 5G services in October 2022.
According to recent reports, Vodafone Idea expects 5G technology to account for around 40% of its total revenue over the next 24 to 30 months. This goal means that Vodafone Idea aims to offer 5G services in around 100 of the top 100 cities and towns that generate 40% of its current revenue, according to a company spokesperson.
The telco recently completed the minimum rollout obligations for 5G rollout across four telecom verticals in India.In an investor presentation, Vodafone Idea, a joint venture between British telecom operator Vodafone and India’s Aditya Birla Group, said its late entry into India’s 5G race will enable it to take advantage of the latest advances in 5G technology in a cost-effective manner.
The Indian telco also said that 90% of its wireless equipment is already 5G-enabled. During the presentation, the company also announced plans to redeploy airwaves in the 900MHz and 2.1GHz bands as part of the telco’s plans to expand 4G coverage in 17 priority markets across India.
Mavenir, a US-based open RAN (O-RAN) provider, recently announced that it is on track to win a commercial contract from Vodafone Idea for the rollout of the company’s 5G network by the end of the year.
