Vodafone Might Lead Towards Liquidation In India - Says CEO Nick Read

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The tariff war in the Indian telecom sector has made it difficult for a lot of companies. Either they have to pack their bags or to join hands with other companies to survive in the market. Now, it has been reported that the values of the Vodafone and Idea joint venture is zero. Nick Read CEO of the company has indicated that the future of Indian operators is heading towards liquidation if the government doesn't reduce mobile spectrum charges.

Vodafone Might Lead Towards Liquidation In India - Says CEO Nick Read

 

According to the Vodafone Group annual results, the book value of the Vodafone's 45 percent stakes in the joint venture with Idea has collapsed down to zero in November. Last year in June, the book value of the company was EUR 2 billion. However, the value downgraded to EUR 1.5 billion this year in May.

Vodafone released its financial results on Tuesday and the company has mentioned all losses, bad clash flows, a provision from the Supreme Court judgement, and more.

"As the Group has no obligation to fund VIL losses, the Group has recognised its share of estimated Vodafone Idea Limited ('VIL') losses arising from both its operating activities and those in relation to the AGR judgement to an amount that is limited to the remaining carrying value of VIL, which is therefore reduced to nil," Gadgets 360 quoted Vodafone as saying.

According to the report, the Vodafone Group's carrying vale went down to nil on 30 September, in March 2019 the company was carrying a value of EUR 1,392 million and in May 2019 the company has invested EUR 1,410 million to witness some profit.

Media reports suggest that after the financial results in London, Read said that the Vodafone venture might head to the liquidation if the government doesn't help the telecom company. According to the report, it seems that Vodafone, which is one of the largest foreign investors, is not ready to invest in India.

 
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