Vodafone Idea released a clarification today on The Financial Times report that had suggesting Google was exploring an investment opportunity in the operator. In a letter to the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE), the operator said that “no proposal as reported by the media” has been considered by the board. Vodafone Idea is currently struggling even though the operator has a significant share of mobile subscribers that makes it the second-largest player after Jio in the country. Reliance Jio has recently attracted about $10 billion in investments from Facebook and US private equity firms.
“As part of corporate strategy, the company constantly evaluates various opportunities for enhancing the stakeholders’ value,” Vodafone Idea said in the letter to stock exchanges.
The letter also highlighted that the company “shall comply with the disclosure obligations” and will provide prior information to the stock exchanges as and when it will consider an investment proposal.
“We wish to reiterate and clarify that the company will comply with SEBI Listing Regulations and duly keep the stock exchange informed of all the price-sensitive information,” it added.
The letter doesn’t provide any clarity on whether Google approached the telecom operator to discuss the investment, which was reported by The Financial Times on Thursday. The report, quoting one of the people familiar with the development, suggested that the Mountain View, California-based tech giant was considering buying a 5% stake in the telecom operator.
Hours after the report went out in the public and was covered by various news publications, the operator’s share price surged over 30% earlier on Friday. The share price dropped down to about a 13% increase once the operator came up with this clarification on the Google-Vodafone Idea deal.
The investment from Google would help the telecom operator better sustain its business that reported a quarterly loss of ₹6,439 crores in February. The telecom operator has also lost seven million subscribers. The entity is a result of the merger of Britain’s Vodafone Group and industrialist Kumar Mangalam Birla’s Idea Cellular. The merger took place in August 2018 and the operator is facing a tough fight from Jio and Airtel in the Indian telecom market.
That is all about the Google-Vodafone Idea deal. Stay tuned for more updates.