(Updates to add deal talk)
By Sankalp Phartiyal
NEW DELHI, Sept 22 (Reuters) - Vodafone Idea is
confident it can reach a fundraising deal with potential
investors, bolstered by a federal government package that
provides much-needed relief to the debt-ridden mobile carrier,
its chief executive officer said on Wednesday.
Vodafone Idea, a combination of the India unit of Britain's
Vodafone Group and domestic telecoms company Idea
Cellular, has a net debt of 1.91 trillion rupees ($25.86
billion), including government dues of 1.68 trillion rupees.
Prime Minister Narendra Modi's government last week approved
a relief package for the country's cash-strapped telecoms
sector, including a four-year moratorium on airwaves fees due to
the state.
CEO of Vodafone Idea Ravinder Takkar said investors had been
waiting to see whether New Delhi would ensure that at least
three players exist in the telecoms sector and also wanted the
funding to be used for business rather than paying government
dues.
"With this package all of those fears to some extent have
been put aside," Takkar said in a video interview, without
specifying the names of investors the company was in talks with
or a timeline for the fundraising.
Local media reported earlier this year that Vodafone Idea
was in talks with investment manager Apollo Global Management
to raise up to $3 billion.
On Wednesday, Takkar declined to confirm the talks, saying it
was "just speculation".
"With this tremendous change (govt package) our business
plans will have to be updated, which means our funding
requirements will also have to be updated," he said.
India's telecoms sector ran into trouble in late 2016 with
the entry of tycoon billionaire Mukesh Ambani's Reliance Jio,
which sparked a price war that forced some rivals out of the
market and turned profits into losses.
A Supreme Court ruling in late 2019 also added to the
sector's pain, saddling telecoms companies with dues of roughly
$13 billion.
The government's latest measures are expected to ease some
of that pain, boost the growth of telecoms firms in the world's
second-biggest wireless market by number of users, and give a
fresh lease of life to Vodafone Idea.
"There should be no doubt that... Vodafone Idea will exist,
we will compete, we will survive, we will thrive," said Takkar.
(Reporting by Sankalp Phartiyal, Editing by Louise Heavens and
Jane Merriman)