Vodafone Weighs Stake Transfer to Bolster Struggling Indian Unit Vodafone Idea

Group Plc is exploring a strategic move to transfer a portion of its 19% stake in Vodafone Idea Ltd (Vi) back to the Indian telecom operator to be held as treasury shares, according to people familiar with the matter. The plan aims to strengthen Vi’s balance sheet without requiring fresh cash infusion from the UK parent. The proposed internal restructuring comes as the loss-making Indian joint venture ramps up efforts to raise substantial debt and clear pending government obligations. By parking the shares in treasury, Vodafone Idea would gain an equity cushion that could improve its financial metrics and make it more attractive to lenders. Capital Boost Without Cash Outlay Under the plan being weighed, Vodafone would transfer part of its shareholding to Vi instead of injecting additional capital directly. This approach follows the Indian government’s recent decision to ease the company’s spectrum dues burden, providing some financial breathing room. Treasury shares do not carry voting rights and can potentially be reissued or sold later in the market, offering Vi flexibility to raise funds in the future for network expansion, 5G rollout, or further debt servicing. Debt Raise on the Horizon Vodafone Idea is currently in advanced discussions with lenders to borrow approximately ₹35,000 crore (about $3.7 billion). ank of India is expected to lead the lending consortium, with the bulk of the facility structured as term loans. The fresh debt is intended to support Vi’s operational turnaround, clear remaining government dues, and fund capital expenditure needed to remain competitive in India’s cut-throat telecom market, dominated by !Reliance Jio and ti Airtel.