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Vodafone Idea raises Rs 5000 crore in short-term borrowings for NCD payouts – Economic Times

Mumbai | Kolkata: (Vi) has raised an estimated ₹5,000 crore via short-term loans from a clutch of lenders, led by State Bank of India and including , HDFC Bank, IndusInd and Union Bank of India, people with direct knowledge of the matter said.

The telecom joint venture between UK’s Vodafone and India’s Aditya Birla Group plans to use the cash for ₹4,500 crore of pay-outs towards redemption of non-convertible debentures (NCDs) due by February 2022, the people told ET. Vi has already cleared a ₹1,500 crore tranche towards redemption in early-January and will pay the remaining ₹3,000 crore in three tranches of ₹2,000 crore, ₹500 crore and ₹500 crore through January-February 2022, according to disclosures in its latest annual report.

Vi’s short-term loans will mature in less than a year, and the interest is likely to be in a wide range of 6.5-8.5% depending on individual banks, one of the people said.

The telco, on its part, is looking to clear these loans with proceeds of its much-awaited equity-based fundraising that it likely to close by end of this fiscal year in March. “Vi is planning an equity share sale from global investors … once that happens in the next few months, our loan will be repaid using a portion of the proceeds,” another person said.

Last month, Vi’s top deck indicated on an internal investors’ call that the telco expects to close its equity funding, including from promoters, by end-March. It was the first time Vi’s leadership said the company’s promoters – Vodafone Plc and the Aditya Birla Group – are likely to inject fresh equity amid efforts to close the telco’s long-pending fundraise. UK’s Vodafone and the Aditya Birla Group now own 44.39% and 27.66% shares, respectively, in Vi.