After FB-Jio deal, Google to take Voda Idea stake?

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NEW DELHI: So will the Indian telecom market, and the biggest player Reliance Jio, face the might of American giant Alphabet Inc’s Google? If reports are to be believed, Google is exploring a move to pick up a minority stake in Vodafone Idea, the beleaguered telecom operator that is owned by Britain’s Vodafone and domestic business house Aditya Birla Group. Alphabet is looking to buy about 5% stake in Vodafone Idea, the Financial Times reported on Thursday. When contacted, the Indian subsidiary of Google and Vodafone Idea refused to confirm the development. The struggling Vodafone Idea was formed after the aggressive entry of Jio broke the financials of the Indian telecom industry.
The company is seeking support from the government as well as the courts in clearing dues and liabilities. Problems for the company compounded after the Supreme Court’s October 2019 judgment on adjusted gross revenue (AGR) that had asked companies such as Airtel and Vodafone Idea (both heavily debt-laden) to pay back thousands of crores of rupees in past dues. If Google is successful in striking the deal with Vodafone Idea, it will pit the search giant against fellow American Facebook, which has picked up a stake in Jio Platforms.

Facebook and other private equity investors have cumulatively poured in around $10 billion in Jio Platforms. A possible deal with Google is likely to help Vodafone Idea garner the much-required cash to pay the government nearly Rs 58,000 crore in unpaid statutory dues, which were demanded following the AGR judgment. There is speculation that as Jio raises money from global investors, there are similar interests being evinced in the business of both Airtel and Vodafone Idea.



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