The State Bank of India (SBI) has asked Vodafone for cash and a cash equivalent against a guarantee sought by the operator for depositing with the Supreme Court in its case against the income tax department. This guarantee may include funds, fixed deposits or even treasury bills.
The operator has to offer liquid collateral worth 110 per cent of the total guarantee amount of Rs 85 billion. Currently, Vodafone is in the final round of discussions with the SBI for the guarantee after the Supreme Court had, in November 2010, asked it to provide a bank guarantee from a nationalised bank and set aside Rs 25 billion in cash with the court. The court has given the telecom company two months to arrange for the guarantee.
The guarantee is expected to be provided by mid-January.
