Following equity allocation, the government acquires 33.44% of Vodafone Idea.

The government was granted equity shares worth Rs 16,133 crore on Tuesday, making it the largest stakeholder in Vodafone Idea with a 33.44 percent interest in the business. Vodafone Idea is a debt-ridden telecom provider.
According to the company’s regulatory filing, the shares have been given to the government in lieu of conversion of interest dues resulting from the postponement of payments for spectrum auctions and adjusted gross revenue.
The government will retain 33.14 percent, according to an earlier estimate from Vodafone Idea, with promoters Aditya Birla Group and Vodafone Group holding 18.07 percent and 32.29 percent, respectively.
Analysts claim that the government allowing Vodafone Idea’s interest dues conversion into equity is a near-term positive for the telecom operator as it would help free up some cash flows with the prospect of future rate increases.

This news is written by Mr. Manpreet Rathor, Research Assistant, All India Legal Forum.