LONDON: Vodafone Group Plc has launched a placing of its remaining 79.2 million shares in Indus Towers Limited representing 3.0% of Indus’ outstanding share capital through an accelerated book build offering.
The proceeds will be used firstly to repay Vodafone’s outstanding borrowings of $101 million to Vodafone’s existing lenders, secured against Vodafone’s Indian assets.
Under the terms of the security arrangements entered into between Vodafone and Indus, Indus has a security over the residual proceeds from the Placing to guarantee obligations from Vodafone Idea Limited (Vi) to Indus under the Master Services Agreements (“MSAs”).
As permitted under the Security Arrangements, Vodafone intends to contribute the residual proceeds from the Placing (after repayment of Vodafone’s outstanding borrowings) towards an issue of new equity shares by Vi (a “Capital Raise”) once the terms of such a Capital Raise have been evaluated and decided on by the Board of Directors of Vi. The proceeds from the Capital Raise would be used by Vi to pay outstanding MSA dues to Indus.
Following the repayment of Vodafone’s outstanding borrowings, if any Indus Shares remain, such Indus Shares and any proceeds which are not used by Vodafone to subscribe to new shares in Vi would be available to Indus to guarantee Vi’s obligations under the MSAs.