Vodafone Group is likely to inject an additional Rs 2,850 million in Vodafone Idea Limited by September 2020, as per an arrangement agreed during the 2018 merger of Vodafone India and Idea Cellular. This is in addition to a $200 million payment it had announced in April 2020, under the contingent liability mechanism.
Further, Vodafone Group added that its potential exposure under the contingent liability mechanism is capped at Rs 84 billion and any cash payments or cash receipts relating to these contingent liabilities and potential refunds must have been made or received by Vodafone Idea before any amount becomes due from or owed to the group.
Further, it added that Vodafone Group Plc has potential exposure to certain contingent liabilities and potential refunds relating to Vodafone India and Idea Cellular at the time of the merger, including those relating to the adjusted gross revenue (AGR) judgement, whereby Vodafone Group and Vodafone Idea would reimburse each other on set dates following any crystallisation of these pre-merger liabilities and assets. Under the terms of this arrangement, Vodafone Group is obliged to make payments to Vodafone Idea where amounts paid pursuant to the contingent liabilities of Vodafone India exceed those of Idea Cellular.