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The Government of India will get 9.5 per cent stake in Tata Teleservices as the company announced on Tuesday that it has decided to opt for converting the interest on deferred spectrum and Adjusted Gross Revenue (AGR) liabilities into equity.Tata Teleservices has become the second company to do so after Vodafone Idea."Empowered Committee of the Board of Directors, at its meeting held on January 11, 2022, the Company is expressing its desire for the conversion of the full amount of such interest related to AGR Dues into equity subject to mutual agreement on the terms and conditions, including, the governance of the Company post conversion of the interest amount into equity shares and various regulatory/legal provisions including Section 62(4) and Section 53 of the Companies Act. The Company will communicate the foregoing to the DoT," Tata Teleservices said in a regulatory filing to the stock exchanges.Union cabinet on September 15 approved a slew of measures to support the cash-strapped telecom firms. The relief measures include a four-year moratorium on payment of spectrum and AGR dues. The telecom firms have also been given the option to pay the interest amount arising due to the deferment of payments by way of issuing equity to the government.According to Tata Teleservices, the Net Present Value (NPV) of this interest is expected to be approximately Rs 850 crore as per the Company's best estimates, subject to confirmation by the DoT.The average price of the Company's shares at the relevant date of August 14, 2021 as per the calculation method provided in the DoT Communication works out to be Rs 41.50 per share, subject to final confirmation by the DoT. In case of conversion, it will result in dilution of all the existing shareholders of the Company, including the Promoters."Following conversion, it is expected that the Government will hold approx. 9.5 per cent of the total outstanding shares of the Company," Tata Teleservices said.The Equity Shares would be issued to the Government on preferential basis.The price shall be equal to higher of the average of weekly high and low of the volume weighted average price of the equity shares during the last 26 weeks preceding the relevant date or two weeks preceding the relevant date, subject to provisions of section 53 of the Companies Act (price cannot be less than par value). The relevant date for pricing to be August 14, 2021.Government, at its sole discretion, may convert any part of such loan to preference shares instead of equity shares and such preference shares may be optionally or compulsorily convertible and/or redeemable and/or participating in nature. The price of any preference shares for the purpose of conversion of the loan shall be equivalent to equity shares.The shares may be held through the statutory undertaking of the Unit Trust of India (SUUTI) on behalf of the Government of India or by any trustee-type or other suitable arrangement.( With inputs from ANI )Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

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The Government of India will get 9.5 per cent stake in Tata Teleservices as the company announced on Tuesday that it has decided to opt for converting the interest on deferred spectrum and Adjusted Gross Revenue (AGR) liabilities into equity. ...