Info-tech

Govt support critical for our survival: Vodafone CEO

Our Bureau Mumbai | Updated on November 12, 2019 Published on November 12, 2019

Nick Read, Vodafone CEO   -  Sergio Perez

British telecom company Vodafone Plc on Tuesday warned that its joint venture with the Aditya Birla Group could be facing liquidation if it does not get financial support from the Government.

“If you don’t get the remedies being suggested, the situation is critical,” Vodafone CEO Nick Read said at a press round-table in London on Tuesday. ”If you’re not a going concern, you’re moving into a liquidation scenario — can’t get any clearer than that.”

Vodafone had entered India in 2007 through a joint venture with the Essar Group. It later acquired Essar’s stake and then termed the India operations its jewel in the crown. But recent developments in the telecom sector have severely impacted Vodafone’s fortunes.

It started with the entry of Reliance Jio, which launched 4G data services at steep discounts. Unable to withstand the Jio onslaught, Vodafone decided to merge with Aditya Birla Group’s Idea Cellular in a bid to create a larger entity. But the latest Supreme Court ruling directing Vodafone and other incumbent players to pay licence fee dues amounting to ₹92,000 crore has come as a huge blow.

Vodafone, which now owns 45 per cent of Vodafone Idea, wants a two-year deferment on spectrum fee payment, lower licence fees, and has wants a 10-year payment timeframe for the dues demanded by the court.

“Financially, there has been a heavy burden through unsupportive regulation, excessive taxes and on top of that we got the negative Supreme Court decision,” Read said.

Published on November 12, 2019
  1. Comments will be moderated by The Hindu Business Line editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.