Kumar Mangalam Birla steps down as chairman of Vodafone Idea, request accepted by board
New Delhi, Aug 4: Amid an existential crisis facing the firm over Rs 50,000 crore unpaid dues towards the government, billionaire Kumar Mangalam Birla on Wednesday stepped down as the chairman of Vodafone Idea Ltd.
Birla, who had in June offered to give away his holding in the joint venture with Britain's Vodafone to the government -- will cease to be a director and non-executive chairman of the company at the end of business hours on Wednesday, VIL said in a filing to the stock exchanges.
It did not give any reason for Birla's decision.
He will be replaced by Himanshu Kapania (who was earlier managing director and CEO of Birla's Idea Cellular) as the new chairman of Vodafone Idea Ltd.
The Supreme Court, last month, had rejected petitions by telecom companies including Vodafone Idea and Bharti Airtel, for rectification of alleged errors in calculation of adjusted gross revenue (AGR) related dues payable by them.
The company lawyers had told the apex court that the firm is making a loss and can "go under" if the rectification is not allowed.
According to official data, VIL had an AGR liability of Rs 58,254 crore, out of which it has paid Rs 7,854.37 crore while Rs 50,399.63 crore is outstanding.
In the BSE filing on Wednesday evening, VIL said: "The Board of Directors of Vodafone Idea, at its meeting held today, have accepted the request of Kumar Mangalam Birla to step down as Non-Executive Director and Non Executive Chairman of the Board with effect from close of business hours on 4 August, 2021."
Consequently, the board has "unanimously elected" Himanshu Kapania, currently a non-executive director and a nominee of the Aditya Birla Group, as the non-executive chairman.
Kapania is a telecom industry veteran with 25 years of experience, including significant board experience in telecom companies globally. He has also served on the Global GSMA Board for two years and was chairman of the Cellular Operators Association of India (COAI) for two years.
The move comes just weeks after Birla offered to hand over stake in VIL to the government, in a desperate attempt to keep the company afloat.
The billionaire businessman had made the offer in June in a letter to Cabinet Secretary Rajiv Gauba.
In the letter, Birla, who holds around 27 per cent stake in VIL, said investors are not willing to invest in the company in the absence of clarity on AGR liability, adequate moratorium on spectrum payments and most importantly floor pricing regime above the cost of service.
Without immediate active support from the government on the three issues by July, the financial situation of VIL will come to an "irretrievable point of collapse", Birla said in the letter dated June 7.
"It is with a sense of duty towards the 27 crore Indians connected by VIL, I am more than willing to hand over my stake in the company to any entity- public sector/government /domestic financial entity or any other that the government may consider worthy of keeping the company as a going concern," Birla had said in the letter.
In September 2020, VIL had received approval from its board to raise up to Rs 25,000 crore. However, the company has not been able to raise the funds so far.
According to Birla's letter, VIL has not yet approached any Chinese investors. Foreign investors, mostly non-Chinese, are hesitating in making investment in the company for understandable reasons, he wrote.
VIL's gross debt, excluding lease liabilities, stood at Rs 1,80,310 crore as of March 31, 2021. The amount included deferred spectrum payment obligations of Rs 96,270 crore and debt from banks and financial institutions of Rs 23,080 crore, apart from the AGR liability.
Eariler, Vodafone Idea Ltd had also approached the government to seek a one-year moratorium on payment of spectrum instalment of over Rs 8,200 crore, due in April 2022.
VIL, in a letter to the telecom secretary on June 25, 2021, had said it will be "unable to pay the instalment of Rs 8,292 crore due on April 9, 2022" due to "cash being used for payment of AGR (Adjusted Gross Revenue) dues and the inability of the operations to generate the required cash in a predatory pricing situation".
Let the Truth be known. If you read VB and like VB, please be a VB Supporter and Help us deliver the Truth to one and all.
CJI Chandrachud urges voters not to miss voting in 2024 general elections
New Delhi (PTI): Chief Justice of India DY Chandrachud has urged citizens not to miss the opportunity to vote in the general elections, saying that it is the "foremost duties" in a constitutional democracy.
In a video message for the Election Commission’s 'My Vote My Voice' mission for the 2024 Lok Sabha polls, Justice Chandrachud said, "We are citizens of the world's largest democracy, which is our country.”
"The Constitution gives us a multitude of rights as citizens but it also expects that each of us performs the duty, which is cast upon us. And one of the foremost duties of citizenship is to cast a vote in a constitutional democracy," he said.
"I will request every one of you please do not miss this opportunity to vote responsibly as citizens of our great motherland. Five minutes, every five years for our nation. It's doable, isn't it? Let's vote with pride. My vote, my voice," the CJI said.
Justice Chandrachud said the citizens have a participatory role in electing the government and that is why it is said that "this government is a government of the people, by the people and for the people".
He recalled his excitement as the first time voter and queuing up at the polling booth to exercise the franchise.
"The ink on the finger when I vote allows tremendous feelings of patriotism and association with the nation...," he said.
"So our Constitution and our law provides for one citizen, one vote and one value. I think that's the great tenacity and the power of our nation as a constitutional democracy," he said.
The CJI said he never missed that duty to cast his vote when he was a lawyer and had to run around for work.
The Lok Sabha elections will be held from April 19 to June 1, 2024 to elect the 543 members of the 18th Lok Sabha.
The elections will be held in seven phases and the results will be announced on June 4. 2024.
