Idea to issue equity shares to Aditya Birla Group Entities

The Board of Directors of Idea Cellular has approved issuance of 326.6 million equity shares (face value of Rs. 10 per share) at a price of Rs. 99.50 per share on preferential basis to Aditya Birla group entities – Birla TMT Holdings/Elaine Investments (Singapore)/Oriana Investments (Singapore)/Surya Kiran Investments (Singapore). The aggregate capital infusion will be of Rs. 3,250 crore.

Kumar Mangalam Birla, Chairman, Idea Cellular said, “The Aditya Birla Group remains committed towards the telecom business. The group is in the process of creating a large digital infrastructure and to contribute significantly towards fulfilment of the ‘Digital India’ vision of the Prime Minister. At a time when the telecom industry is going through a challenging environment, this equity infusion by the Group in Idea is another step towards reinforcing the group’s commitment.”

The above equity issue is subject to shareholders and other regulatory approvals. The Extraordinary General Meeting (EGM) of shareholders is to be convened on January 30, 2018.

The issue is expected to complete by early February, 2018, post which the shareholding of Promoter group in Idea will increase to around 47.2% from existing level of 42.4%.

Separately, the Board has also constituted a committee of Board members to evaluate potential routes for raising further capital of up to Rs. 3,500 crore including, among others, further Preferential Issue, Qualified Institutional Placement (QIP), Rights Issue.

Appropriate disclosures will be made once the Board approves such issuance of additional capital based on the recommendations of the Committee. The proposed capital raising along with recent announcement of Idea’s standalone towers sale to ATC and the potential monetization of Idea’s 11.15% stake in Indus Towers, will augment the long term capital resources of the company.

Idea remains committed to participate in digital opportunities and is aggressively expanding its wireless broadband coverage and capacity, with focus on 4G services.

During the first nine months of FY2017-18 Idea has added over 33,500 wireless broadband sites and the current 143,500 broadband sites now cover 620 million Indian population (i.e. 52% of population). Idea is also moving fast to launch its VoLTE services during calendar year 2018.