A consortium led by US-based capital management firm Oaktree Capital Management has proposed investing $2 billion in Vodafone Idea, an Indian joint venture between India's Aditya Birla Group and Britain's Vodafone, a section of local media reported late Thursday night.
This is one of the major fund-raisings by the business which had announced plans last month to raise at least $3.42 billion. Unveiling the plan, the company said the investment will be raised in the next three months via a mixture of debt and equity.
Reportedly, neither Vodafone-Idea nor Oaktree responded to media queries on the issue.
Vodafone Idea has faced massive losses over the past year, thanks to competition from major Indian players Reliance Jio and Bharti Airtel.
The company reported a loss of $988.7 million in the three months from July to September of this financial year (April 2020 to March 2021). In the same period a year earlier, the loss was much greater at $6.97 billion. The company has debt of $15.75 billion and a deferred statutory liability worth $12.6 billion to be paid to the Indian government.
In November last year, Vodafone’s global chief executive Nick Read said its India operations are on the brink of collapse because of “unsupportive regulations and excessive taxes”.
Read later wrote an apology to Indian Prime Minister Narendra Modi claiming that some of the coverage of his statement was distorted.
Immediately after Read's statement, Indian industrialist and chairman of Vodafone Idea Kumar Mangalam Birla said the company would have to close down if the government did not lend the ailing telecom sector a helping hand.
Since then one of the major issues concerning the statutory dues payable by the telecom firms to the Indian government has been settled by the Supreme Court of India.
The court has allowed a payment of $20 billion to be staggered over the next 10 years.
On the $3 billion tax dispute between Vodafone and the Indian government, the Permanent Court of Arbitration at the Hague ruled in favour of the telecom firm. The Indian government has yet to decide its course of action.