Indian billionaire Kumar Mangalam Birla has rejoined the board of Vodafone Idea Ltd as an additional director post a hiatus of 20 months. Vodafone Idea announced in an exchange announcement that Birla, who served as the organization’s chairman from August 2021 until his departure. Now, he has been reinstated as a non-independent and non-executive additional director, pending shareholder approval.

The development is regarded as Aditya Birla Group reaffirming its faith in Vodafone Idea, which has produced total losses of close to Rs 23,000 crore over the past three quarters alone amidst a growing debt and regulatory dues mountain.

In an apparent effort to distance himself from the company, Birla resigned from his position. Citing “dire financial conditions,” Birla has been in talks with investors to raise money to the tune of Rs 11,000 crore through a convertible debt structure to infuse additional promoter equity as well as fund Vi’s significantly behind schedule capex for network maintenance and service upgrades.

On Friday, The government finally gave approval to convert Vodafone Idea’s accrued interest on deferred Adjusted Gross Revenue (AGR) dues, totaling over Rs 16,000 crore, into equity at Rs 10 per share. The government had previously emphasised that the equity conversion was carried out as a result of the promoters of the company agreeing to inject additional capital into the business.

The action was taken as a result of the government receiving a commitment pledge and funding guarantee from the carrier’s promoters. The conversion, which has been in limbo for a year, elevated the government to the position of the company’s largest stakeholder. Government sources had previously informed media that after receiving guarantees from the group over its continued dedication to Vi, the decision to convert the debt into stock was made.

Despite being willing to give substantial equity directly or through a convertible structure to potential investors, the Aditya Birla group has not made up its mind about providing corporate guarantees on loans that the firm is expected to raise.

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