Kumar Mangalam Birla is stepping down from the board of ailing telecom operator Vodafone Idea. Birla was the non-executive chairman and non-executive director on the board of the company.
The board has elected Himanshu Kapania, currently a non-executive director, as the new chairman of the company. Kapania is a telecom industry veteran and previously served as managing director of Idea Cellular. He had also served on the Global GSMA board and was chairman of the Cellular Operators Association of India for two years. Currently, Kapania is chairman of FICCI Council on Telecom, Electronics and Digital Economy.
“The board of directors of Vodafone Idea Limited, at its meeting held today, have accepted the request of Mr. Kumar Mangalam Birla to step down as non-executive director and non-executive chairman of the board with effect from close of business hours on 4th August, 2021,” the company said on Wednesday.
Additionally, the Vodafone Idea board has appointed Sushil Agarwal, a nominee of Aditya Birla Group, as an Additional Director (non-executive and non-independent) with effect from Wednesday.
Agarwal who has been with the Aditya Birla Group since 1989 is currently the group chief financial officer and director of Aditya Birla Management Corporation.
The top management shuffle comes at a time there is growing uncertainty over the company’s future. Vodafone Idea faces an uphill battle to raise funds and pay the hefty bill of Rs 58,000 crore in adjusted gross revenue apart from other payments and dues.
Earlier this week, a letter written by Birla to Cabinet Secretary Rajiv Gauba had surfaced in which he said he was willing to give up his stake in the firm to any entity that the government may consider worthy of keeping the company as a going concern.
He had sought clarity from the government on issues such as moratorium on spectrum payments, floor pricing and AGR payments and said that without active support from the government on the issues, “VIL’s financial situation will drive its operations to an irretrievable point of collapse.”
Vodafone Idea has been losing customers and reported a net loss of Rs 44,233 crore in the year ended March 2021.
Vodafone group CEO Nick Read has also said recently that Vodafone is not putting any additional equity into India.
Amid the uncertainty, Vodafone Idea’s shares slumped 18.5 per cent on Wednesday to close at Rs 6.03. On Tuesday, the stock had fallen 10 per cent.
