Tata Tele opts to convert interest on AGR dues into equity, Govt to own 9.5 pc stake in telco
New Delhi, Jan 11 : Tata Teleservices Today said that its Board has decided to convert interest on adjusted gross revenue (AGR) dues to the tune of Rs 850 crore into equity allowing the government to hold 9.5% stake in the company.
Earlier, debt-ridden Vodafone Idea had also opted for converting interest on spectrum auction installments and AGR related dues into equity paving way for the government to hold about 35.8% stake in the company.
The two companies have opted for the payment plan as part of ‘Telecom Reforms Package,’ announced by the government last October to make it easier for the telcos to clear statutory dues.
In a regulatory filing on Tuesday, Tata Tele said that the Net Present Value (NPV) of the interest related to AGR dues is about Rs 850 crore as per the company’s best estimates.
“The average price of the company’s shares at the relevant date of August 14, 2021 as per the calculation method provided in the DoT Communication works out to be Rs 41.50 per share, subject to final confirmation by the DoT. In case of conversion, it will result in dilution of all the existing shareholders of the company, including the promoters. Following conversion, it is expected that the government will hold approx. 9.5% of the total outstanding shares of the company,” Tate Tele said.
The Board of Tata Tele had on October 26 opted for deferment of AGR related dues by a period of 4 years with immediate effect.
The Department of Telecommunication (DoT) had also provided a time period of 90 days to the company to exercise the option of converting the interest that would accrue on installment payment during the moratorium period into equity.
Following conversion of interest on spectrum auction installments and AGR related dues into equity, government is expected to hold 35.8% stake in Vodafone Idea.
“Following conversion, it is expected that the government will hold around 35.8 per cent of the total outstanding shares of the company, and that the promoter shareholders would hold around 28.5 per cent (Vodafone Group) and around 17.8 per cent (Aditya Birla Group), respectively,” Vodafone Idea had said in a regulatory filing on Tuesday morning.(UNI)
