If reports are to be believed, Google is exploring a move to pick up a minority stake in Vodafone Idea, the beleaguered telecom operator that is owned by Britain’s Vodafone and India's business house Aditya Birla Group.
According to reports, Alphabet is looking to buy about 5% stake in Vodafone Idea. When contacted, the Indian subsidiary of Google and Vodafone-Idea refused to confirm the development. Vodafone Idea has been struggling, which was formed after the aggressive entry of Jio broke financials of the Indian telecom industry. The company is seeking support from the government as well as the courts in clearing dues and liabilities.
Problems for the company have compounded after the Supreme Court’s October 2019 judgment on Adjusted Gross Revenues (AGR) that had asked companies such as Airtel and Vodafone Idea (both heavily debt-laden) to pay back thousands of crores of rupees in past dues.
If Google is successful in striking the deal with Vodafone-Idea, it will pit the search giant against fellow American Facebook, which has picked up a stake in Jio Platforms. Facebook and other private equity investors have cumulatively poured in around $10 billion in Jio Platforms.
A possible deal with Google is likely to help Vodafone Idea garner the much-required cash to pay the government nearly £5.8 billion in unpaid statutory dues, which were demanded following the AGR judgment. Vodafone Idea has said previously that the company may not be able to continue as a going concern if it is not given a relief package from the government. Vodafone Idea has made the plea in several meetings, including with FM Nirmala Sitharaman and telecom minister Ravi Shankar Prasad.
