Vodafone Idea (Vi) may miss the December deadline for raising fresh funding as the debt-laden telecom operator has not yet finalized the terms of the potential deal with investors, according to officials familiar with the discussions. Vi is currently in discussions with potential investors, including in the US, to raise fresh capital through equity and equity-linked instruments. The telco is also negotiating with the Export-Import (EXIM) Bank of the US to raise capital for purchasing 5G network equipment from American companies such as Mavenir.
Further delays in securing fresh funding could have a significant impact on Vi’s expansion plans, specifically the rollout of its 5G services and its ability to regain market share lost to competitors who have already launched 5G networks. Vi has been in talks with investors such as US private equity group Apollo Global Management.
Vi’s CEO, Akshaya Moondra, had previously stated that the discussions would be concluded in the current quarter. The telco had initially announced plans to raise approximately Rs 20,000 crore through a mix of debt and equity, but has since refrained from providing updates on its fundraising plans.
In a statement to ET, Vi clarified that the funding talks were unrelated to its Open-RAN trials with US firms and its funding support discussions with the US EXIM Bank. Vi is conducting Open-RAN trials with Mavenir for a 5G network in several telecom circles and is in negotiations for equipment supply. Unlike stronger rivals Reliance Jio and Bharti Airtel, Vi has yet to commence the rollout of its 5G networks.
Analysts believe that telcos are embracing O-RAN technology to reduce the total cost of ownership compared to traditional RANs from vendors like Nokia and Ericsson. Under O-RAN, telcos can disaggregate hardware and software, enabling vendor interoperability and reducing overall network costs by around one-third. However, some experts argue that the technology has not yet matured, which is why Jio and Airtel have chosen to work with established network vendors like Nokia, Ericsson, and Samsung for their 5G network rollouts.
