According to reports, negotiations are underway to raise 50 billion rupees ($569.5 million) through a debt sale in September for India's Vodafone Idea Telecom Infrastructure, a fully owned subsidiary of telecom operator Vodafone Idea.

The third-largest wireless carrier in India intends to raise 30 billion rupees and 20 billion rupees, respectively, through the issuance of bonds with two and three-year maturities.

Key Highlights

• Vodafone Idea Telecom Infrastructure plans ₹5,000 crore short-term bond issue (2-3 year tenor) for capex.
• Coupons targeted at ~12% for two-year bonds, ~14% for three-year, tapping private credit funds.

The company is anticipated to use private credit funds for the issue and provide coupons of approximately 12% and 14% on bonds with two and three years.

According to one of the sources, "the funds would be used for fresh capex as the company wants to expand."

The board approved Vodafone-Idea's plan to raise 200 billion rupees through loans or equity in May, under the leadership of billionaire Kumar Mangalam Birla.

During an earnings call earlier this month, the company stated that it plans to further extend its 5G services to more important cities across 17 priority circles by September 2025.

Also Read: SEBI Exempts Govt from Open Offer Norm in Vodafone Debt-equity Conversion Deal

Since a historic Supreme Court decision in 2019 expanded the definition of revenue used to determine payments, Vodafone Idea has had difficulty paying unpaid spectrum and revenue-sharing obligations.

In April, the government increased its ownership stake in the company to 48.99% by converting a portion of its spectrum dues into equity to support the losing carrier.