BYLINE: By ANNE DEHNKE | Updated December 08, 2018 09:15:22The biggest telecom company in India is struggling with the fallout from its own missteps.
In an unprecedented move, the country’s largest telcos are going on strike, threatening to shut down the countrys biggest internet provider, Vodafone.
Vodacom is owned by Telenor, which is one of the biggest telecom companies in India.
The company has been struggling to turn around its fortunes, and is set to lose $20bn a year in revenue by 2019.
In December, Votel, India’s largest telecom operator, said it was shutting down the entire countrys largest internet service provider.
In December, the company said that it had raised $2bn from investors including Google, Facebook and LinkedIn.
But in a joint statement, the telcos warned that it could shut down Vodakas service, shutting off the internet for tens of millions of Indians, including some of the country s biggest companies like Reliance Jio.
“The situation is dire.
The company is facing a severe financial crisis and we have to make hard decisions on its future.
We are also looking at possible options for restructuring the company,” Vodas chief executive officer S.V. Rajan said in a statement.
Mr Rajan is now the head of a private equity fund, GVIC.
The fund is backing the company to sell its stake in Vodalas and buy its stake on Vodabank.
Mr Rajan says the company has taken a “very difficult and significant” decision, and the company would be a “strong” beneficiary of the deal.
“We are deeply sorry that Vodapad is closing its doors in a painful way, but the company is the backbone of our countrys economy and its loss is a setback for our economy,” Mr Rajasan said.
“We are in touch with the Government and are prepared to assist in any way possible.”
Vodafonts chairman said that the company was “devastated” by the decision, but was also trying to find ways to save its businesses.
“Vodapads business model was to create a single point of entry to the internet ecosystem for the benefit of its customers.
It has proven to be successful,” Mr Kirtikar said in an email.
“The company was able to generate a huge number of customers by offering a high-speed internet service to customers and it was successful at providing a competitive price.”
Vodavais internet service was supposed to start on January 1, 2019.
However, the firm is facing its worst year in years, and has seen its revenue drop by 30 per cent in a year.
The biggest players have all been selling their shares to the government.
Vodacomp is expected to announce its plan to buy Vodayas shares in the coming days.
Mr Kuntikar has said that Vosfonds shares will be sold at a fair value.
Mr Kirtika says that the telco will take a $2 billion loan from the Reserve Bank of India and a further $10bn from the Government.