It has been rumoured for days that billionaire Elon Musk, who owns satellite internet unit Starlink, is about to buy a stake in beleaguered telecom company Vodafone Idea India and it has even affected the stock market price. It was enough to set off speculation across corporate circles and the company has now scrambled to announce its reaction to these reports.
The company, in its rejoinder to the Bombay Stock Exchange (BSE), says Vodafone Idea is not in talks to tie up with Elon Musk. After the Indian telecom operator’s reaction on Tuesday, its shares went down by 5%.
The clarification from Vodafone Idea came after its stock surged in the past two sessions on what business magazine BusinessWorld said were “markets betting” that Musk was looking to buy a stake in the company to help Starlink enter India.
On Monday, the Bombay Stock Exchange, where Vodafone Idea’s stock is listed, had asked the company for a clarification, citing the BusinessWorld report.
“We would like to submit that the company is not in any such discussion with the named party. We are not aware of the basis of the said news item,” Vodafone Idea said in a statement.
The BusinessWorld report was published on Friday after Vodafone Idea’s stock surged 21%. The stock jumped another 6% on Monday, with trading volume on each day roughly 1.7 billion shares, the most in almost two years.
Vodafone Idea’s stock fell about 5% after the company’s clarification on Tuesday afternoon, with nearly 1 billion shares changing hands.
U.K.-based Vodafone, whose Indian unit merged with Aditya Birla Group’s Idea Cellular in 2018 to form Vodafone Idea, has partnered with Starlink’s rival, Amazon.com’s Kuiper for internet networks in Europe and Africa.
Kuiper does not operate in India.
Domestically, Bharti Airtel and Reliance’s Jio are market leaders in the telecom sector, snatching subscribers from debt-ridden Vodafone Idea, which has not reported a profit since it was formed.
Bharti and Reliance also own satellite companies.
(With inputs from Reuters)
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