Vodafone IPO may hit markets before March 2017

In what will be one of the largest listing in recent times, Vodafone is expected to hit the IPO markets by March 2017. According to news reports in ET, Vodafone is expected to raise $ 2.5 billion or Rs. 17,000 crores in Indian Markets.  Macquarie has valued Indian subsidiary of Vodafone Plc, Vodafone India  at $ 16 billion.

Lead bankers have been finalised and Kotak Investment Bank will do the domestic filing and the investment management for the issue.  Bank of America  Merrill Lynch  (BofAML) , Kotak Investment Banking  and UBS will be the three lead bankers for the issue with ICICI Bank, Deutsche Bank and HSBC being the secondary runners of the book as reported in ET on Wednesday. 

Vodafone IPO talks have been doing the rounds since 2009 . The listing before March 2017 will be a big event in the primary markets in India. Vodafone may use the funds garnered through IPO for repealing its debts previously raised to purchase spectrum. The funds raised through the IPO will also help Vodafone participate in the upcoming  spectrum allocations. 

What is interesting is the fact that the IPO issue of Vodafone  hints at an amicable resolution with the government of India over its tax dispute. Vodafone  seeked International arbitration under the India- Netherland  bilateral investment promotion and protection agreement. Income tax authorities in India have levied a tax on Vodafone's purchase of Hutchison Essar  in 2007.  Vodafone made a payment of $ 11 bn  to Hutchison Telecommunications International for the acquisition. Vodafone has always maintained that the transaction was done overseas and hence it could not be taxed in India.