Vodafone to invest $2 billion in India
Vodafone has confirmed plans to invest up to $2 billion in a bid to buy out some minority shareholders in its Indian subsidiary.
The company will be one of the first to exploit new rules for liberalising foreign ownership of telecoms companies in India.
Vodafone will still have to undergo a lengthy process for the proposals to go through, and will have to submit an application this month to the country’s foreign investment board to win permission.
Indian regulators announced plans to liberalise the telecoms market in July to allow foreign companies 100% ownership of their subsidiaries, increasing from 74%, to attract additional foreign investment.
Vodafone has a long running legal and regulatory dispute with the Indian government, which includes an unresolved tax bill of approximately $2.6 billion.
It presently owns 64% of Vodafone India, with 11% owned by billionaire industrialist Ajay Piramal. The remaining 25% is owned by various minority shareholders. Vodafone’s commitment of $2 billion however, does not neccessarily indicate it will take full 100% ownership of the company.