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Vodafone Idea reportedly looking to flog assets to cover government bill

Beleaguered Indian operator group Vodafone Idea has apparently been reduced to a fire sale of its fibre and datacentre assets to raise funds in a hurry.

Scott Bicheno

December 11, 2019

1 Min Read
Vodafone Idea reportedly looking to flog assets to cover government bill

Beleaguered Indian operator group Vodafone Idea has apparently been reduced to a fire sale of its fibre and datacentre assets to raise funds in a hurry.

The news comes courtesy of the Economic Times, which has been chatting to those handy anonymous insiders. They reckon Vodafone Idea has been in discussions with Brookfield Asset Management regarding the sale of its fibre business and with investment firm Edelweiss over the prospect of flogging its datacentre in Navi Mumbai.

Vodafone Idea apparently has 156,000 km of fibre buried somewhere in India, which is thought to be worth up to $2 billion according to bankers consulted by ET. Even the datacentre could raise $100 million, they were told. Having said that, since the Indian government wants at least $5 billion in historical license fees from the company, it’s unlikely to get full value from its asset sale thanks to its weak negotiating position.

An additional complication, according to experts quoted in the story, is the fact that the entire Indian telecoms sector is mortgaged to the hilt, so there simply isn’t that much cash circulating around it in total. This makes the decision by the government to call in these massive historical debts even more flawed. India seems to have dug itself into a very difficult hole with regard to its telecoms sector and it’s not obvious how it’s going to climb out of it.

About the Author(s)

Scott Bicheno

As the Editorial Director of Telecoms.com, Scott oversees all editorial activity on the site and also manages the Telecoms.com Intelligence arm, which focuses on analysis and bespoke content.
Scott has been covering the mobile phone and broader technology industries for over ten years. Prior to Telecoms.com Scott was the primary smartphone specialist at industry analyst Strategy Analytics’. Before that Scott was a technology journalist, covering the PC and telecoms sectors from a business perspective.
Follow him @scottbicheno

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