NSE block deal data showed Vodafone’s shares in Indus have been acquired by the likes of Morgan Stanley Asia, BofA Securities Europe, Blackstone, Societe Generale, Copthall Mauritius Investment, Vanguard, Optimas Global Alpha Fund, Kotak Mahindra Mutual Fund, ICICI Prudential Life Insurance Co and the National Pension System (NPS) Trust amongst others.
As per NSE block deal data, Omega Telecom Holdings Pvt Ltd, a Vodafone Group entity, sold 5.963 crore shares — or 2.26% — in Indus Towers at Rs 353.7 a piece, aggregating Rs 2,109.41 crore. Usha Martin Telematics Ltd, another Vodafone Group entity, sold its near 1.96 crore shares — or 0.74% in India’s second-largest tower company — also at Rs 353.7 a piece, aggregating Rs 692.28 crore.
The Indus stock had closed 1.32% higher at Rs 363.50 on the BSE Thursday. At its current market capitalisation of Rs 95,897.22 crore, Vodafone’s 3% stake in Indus is worth around Rs 2,877 crore. NSE block deal data showed that UK’s Vodafone has sold its remaining Indus shares at a modest 2.7% discount to the tower company’s closing share price on Thursday.
NSE block deal data also revealed that Morgan Stanley Asia was the top buyer, lapping up Indus shares worth Rs 744.54 crore, followed by Kotak Mahindra Mutual Fund which bought shares worth Rs 512.87 crore. BoFA Securities was the third-largest buyer, mopping up Indus shares worth Rs 446.83 crore. The NPS Trust, in turn, bought Indus shares worth Rs 300.65 crore.
Earlier on Wednesday, UK’s Vodafone had said it would be selling 79.2 million shares, representing 3% of Indus’ stake, through an accelerated book-build offering. It had added that the Indus stake sale proceeds would initially be used to clear its $101 million outstanding borrowings to existing lenders, secured against Vodafone’s Indian assets. But the British carrier also plans to invest the remaining stake sale proceeds in Vodafone Idea (Vi) — its Indian telecom joint venture with the Aditya Birla Group — against fresh shares to help the latter clear a portion of its old dues to Indus.Vi has already scheduled a board meeting on December 9 to consider a proposal for raising funds not exceeding Rs 2,000 crore by way of issuance to its co-promoter, the Vodafone Group.
Axis Capital said Vodafone’s plans to infuse fresh capital into Vi out of a portion of its Indus stake sale proceeds would help the UK carrier’s Indian telecom JV to rapidly clear its backlog of dues to the telecom tower company.
The brokerage added that in the last two quarters, Vi had paid Rs 800-1,000 crore towards its Indus dues. As a result, the Indian tower company has reduced the allowance for doubtful receivables relating to Vi to Rs 3548.4 crore in the quarter ended September 30, 2024, from Rs 5385.3 crore in the quarter ended March 31, 2024.
Vi’s financial health is vital for Indus’ long-term financial stability as the telco accounts for around 35-40% of the tower company’s revenues. But since January 2023, Vi has been paying Indus 100% of its monthly billing, and periodically also its older dues.
JP Morgan said a potential clearing of a portion of Indus’ past dues to the extent of Rs 1,970 crore by Vi could result in a special dividend announcement of Rs7.5/share by the telecom tower company in FY25 itself.
Earlier, Indus had released the pledge on 3.003% shares held by Vodafone to enable the latter to execute their sale and use the proceeds as per terms of a security package provided by the UK telco. Under terms of the security arrangements between Vodafone and Indus, the Indian tower company has a security over residual proceeds (from the block deal) to guarantee Vi’s obligations.
Back in June 2024, Vodafone had sold 18% in Indus — out of its earlier 21.05% holding — for Rs 15,300 crore through an open market transaction. The stake sale proceeds were largely used to clear a bulk of €1.8 billion borrowings secured against Indian assets.
Indus Towers was founded in November 2007 as a three-way JV among erstwhile Bharti Infratel (then Airtel’s tower unit), UK’s Vodafone and Aditya Birla Group-backed erstwhile Idea Cellular.
After the merger of Vodafone India and Idea in August 2018 to form Vodafone Idea, UK’s Vodafone and Bharti Infratel owned 42% each in Indus Towers. Vi held 11.15% and US-based asset management firm Providence Equity Partners had the balance 4.85%.
During the subsequent towers merger of Airtel-backed Bharti Infratel and Indus in end-2020, Vi cashed out by selling its 11.15% stake, leaving Bharti Airtel and Vodafone Group as co-promoters of the merged entity.
