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Shares of Vodafone Idea Ltd.
are in focus on Thursday, January 1, after the company said it has reached a revised agreement with the Vodafone Group promoters to recover money linked to liabilities from the 2017 merger of Vodafone India and Idea Cellular.
The company on Wednesday said the changes relate to the agreement at the time of the merger to settle any tax, legal or regulatory liabilities that may arise later from the two firms' past operations.
As per the contingent liability adjustment mechanism, Vodafone Idea had recorded up to ₹8,369 crore as money receivable from the Vodafone Group and ₹1,975 crore of this has already been paid.
The amended agreement now permits Vodafone Idea to recover around ₹5,836 crore as of December 31, 2025.
The recovery will be in two parts — first, the Vodafone Group promoters will pay ₹2,307 crore in cash over the next year; second, certain Vodafone Group shareholders will set aside 3.28 billion Vodafone Idea shares for five years. These shares can be sold at the firm's direction and the money raised will go to Vodafone Idea. At the present market rate, these shares are valued around ₹3,529 crore.
Vodafone Idea said the revised structure improves the visibility of future cash inflows and also strengthens its financial position. It also clarified that the firm does not need to make any payments to the Department of Telecommunications to receive this money.
Shares of Vodafone Idea fell 11.5% on Wednesday after the government capped its AGR dues at ₹87,695 crore for a five-year moratorium. The stock closed at ₹10.67 apiece to end below its FPO price of ₹11.
The company on Wednesday said the changes relate to the agreement at the time of the merger to settle any tax, legal or regulatory liabilities that may arise later from the two firms' past operations.
As per the contingent liability adjustment mechanism, Vodafone Idea had recorded up to ₹8,369 crore as money receivable from the Vodafone Group and ₹1,975 crore of this has already been paid.
The amended agreement now permits Vodafone Idea to recover around ₹5,836 crore as of December 31, 2025.
The recovery will be in two parts — first, the Vodafone Group promoters will pay ₹2,307 crore in cash over the next year; second, certain Vodafone Group shareholders will set aside 3.28 billion Vodafone Idea shares for five years. These shares can be sold at the firm's direction and the money raised will go to Vodafone Idea. At the present market rate, these shares are valued around ₹3,529 crore.
Vodafone Idea said the revised structure improves the visibility of future cash inflows and also strengthens its financial position. It also clarified that the firm does not need to make any payments to the Department of Telecommunications to receive this money.
Shares of Vodafone Idea fell 11.5% on Wednesday after the government capped its AGR dues at ₹87,695 crore for a five-year moratorium. The stock closed at ₹10.67 apiece to end below its FPO price of ₹11.
