Vodafone Idea, a Gujarat-based telecom giant, has secured Rs 5,400 crore from a pool of 74 anchor investors. This crucial funding comes just before their Follow-on Public Offer (FPO), India’s biggest to date.

The company strategically allocated 491 crore shares at Rs 11 per share to these anchor investors. This group includes prominent names like GQG Partners (US), Fidelity Investments, UBS Fund Management, and The Master Trust Bank of Japan.

GQG Partners Takes the Lead

Among the anchor investors, GQG Partners emerged as the frontrunner, contributing a significant Rs 1,345 crore. This translates to roughly 26% of the total shares allotted to this category. Other notable contributions came from Fidelity Investments (Rs 772 crore), Troo Capital (Rs 331 crore), and Australian Super (Rs 130 crore).

Domestic Mutual Funds Step Up

Domestic mutual funds also played a part, with five leading funds, spearheaded by Motilal Oswal Midcap Fund, collectively investing Rs 874 crore. This represents a significant 16.2% of the total anchor investor allocation.

Fueling Network Expansion

The funds raised will be used for a comprehensive network expansion plan. This includes establishing new towers to bolster both 4G and 5G services. The overall goal is to raise Rs 18,000 crore through the FPO, which opens today (April 18th) and closes on April 22nd. The price band for the FPO is set between Rs 10 and Rs 11 per share.

Focus on 5G Infrastructure

Out of the targeted Rs 18,000 crore, a major chunk (Rs 12,750 crore) will be directed towards strengthening network infrastructure. A sizeable portion (Rs 5,720 crore) is earmarked for establishing 22,000 new 5G towers over the next two years. This ambitious plan aims to launch 5G services in select regions within 6-9 months of the FPO’s completion. The remaining funds will be used to upgrade existing 4G capabilities, manage spectrum payments, and address other corporate needs.

Strategic Importance of the FPO

This FPO holds immense significance for Vodafone Idea. Not only is it the largest public offering in India’s history, but it’s also critical for the company to stay competitive with rivals like Airtel and Reliance Jio, who already offer 5G services. The government, currently the largest shareholder with a 32% stake, will see its shareholding slightly reduced to around 24% after the FPO. Similarly, the promoter holding will also decrease to approximately 38%.