“It is with a sense of duty towards the 27 Crore Indians connected by ViL, I am more than willing to hand over my stake in the company to any entity, public sector, government domestic financial entity, or any other, that the government may consider worthy of keeping the company as a going concern. I and my team will be more than happy to work with the government to urgently explore all possible options and solutions to save the company and strengthen it in the national interest without any consideration of our private interest,” Birla said in his letter dated June 7 to Rajiv Gauba, Cabinet Secretary.
This is the first time that one of Vi’s parents have spoken to the government of their plans to offload their stake, fearing a collapse of the loss-making telco.
In the letter, Birla sought active support from the Government regarding clarity on adjusted gross revenue (AGR), spectrum payments and floor pricing regime which have been hurting the telco.
“I want to emphasize that without immediate active support from the government on these three issues, certainly by July 21, VIL’s financial situation will drive its operations to an irreversible point of collapse,” said Birla.
The Aditya Birla Group has a 27.66% stake in Vi whose other parent is Vodafone Group which holds around 44%.
Birla also highlighted that his telco is yet to approach any Chinese investors for raising Rs 25,000 crore to run his telco.
“To actively participate in this fundraising the potential foreign investors, (mostly non Chinese, and we are yet to approach any Chinese investors) want to see clear government intent to have a three player telecom market, (consistent with its public stance), through positive actions on long standing requests, such as clarity on AGR liability adequate moratorium on Spectrum payments, And most importantly, floor pricing regime, above the cost of service in the absence of definite steps in this regard, the potential investors have understandable hesitation to invest,” stated the letter.
Vi faces total AGR dues of Rs 58,254 crore, of which it has paid more than Rs7,800 crore, and is also staring at a potential $3.1 billion (Rs 23,500 crore) shortfall in cash flows in FY23 as it has big upcoming payment obligations.
It has appealed to the government to defer by a year a spectrum payment of over Rs8,200 crore falling due in April 2022. Besides the Rs25,000 crore fund-raising plans, the telco is hoping to raise another $1 billion by selling its data centre, optic fibre assets and home broadband unit YOU Broadband.
