Ahead of the 5G spectrum auction, cashstrapped telecom operator Vodafone Idea plans to raise up to Rs 500 crore from UKbased promoter Vodafone Plc.

In a regulatory filing, Vodafone Idea said they will be conducting a board meeting on Wednesday, “to consider a proposal to raise funds aggregating up to Rs 500 crore, by way of issuance of equity shares and/or convertible warrants on a preferential basis to one or more entities belonging to Vodafone Group”.

The fundraiser will be through the issuance of equity shares or convertible warrants on a preferential basis to one or more entities belonging to Vodafone Group (one of the promoters of the company). Following the September reforms announced by the Centre, debt-ridden Vodafone Idea (VIL) had opted for converting about Rs 16,000 crore interest dues liability payable to the government, into equity.

This will result in the government holding about 33 per cent stake in the company and the promoters’ stake will get diluted to around 50 per cent from the current 75 per cent. Sources at the department of telecommunications (DoT) said that VIL’s equity conversion proposal is in the final stages, and the required approvals on the same are expected as early as 7-10 days. Promoters Vodafone Plc and the Aditya Birla Group have already infused Rs 4,500 crore of equity into the company in March.