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Vodafone Idea Shares Jump 15% On Vodafone Group's Payment

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On Thursday, shares of Vodafone Idea jumped as much as 15 percent to an intraday high of Rs 4.55 before easing. The second consecutive day of surge comes after Vodafone Group accelerated payment of $200 million (about Rs 1,530 crore) to the telecom operator, giving it liquidity to manage its operations.

This payment under the terms of the contingent liability mechanism was due in September 2020.

Vodafone Idea Shares Jump 15% On Vodafone Group's Payment
 

In a statement to the exchanges, Vodafone Group Plc, the UK-based parent of Vodafone Idea, said "Vodafone Group has accelerated this payment to provide Vodafone Idea with liquidity to manage its operations, and to support the approximately 300 million Indian citizens who are Vodafone Idea customers as well as the thousands of Vodafone Idea employees during this phase of emergency health measures, taken as a result of the COVID-19 pandemic."

It also said that after the Supreme Court's verdict on the definition of adjusted gross revenue in October 2019, telecom operators in India are liable for licence fees, penalties and interest dating back over 14 years.

"Vodafone Idea has made payments to the Government of India in relation to its AGR liabilities. Under the terms of the CLM (contingent liability mechanism), Vodafone Group is obliged to make payments to Vodafone Idea where amounts paid pursuant to the contingent liabilities of Vodafone India exceed those of Idea Cellular. The CLM took effect at completion of the merger of Vodafone India and Idea Cellular in August 2018," it added.

Read more about: vodafone idea
Story first published: Thursday, April 23, 2020, 10:17 [IST]
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