India's Vodafone Idea is not in talks to tie up with billionaire Elon Musk's satellite internet company Starlink, the telecom operator said on Tuesday, dashing hopes of reviving the debt-laden company that sent its shares soaring.
The clarification came after shares in Vodafone Ideas rose in the past two sessions on what business magazine BusinessWorld said were “market bets” that Musk was looking to buy a stake in the company to help Starlink enter India.
“We would like to state that the company is not in such discussions with the named party. We are not aware of the basis of the said news,” Vodafone Idea said in a statement after the Bombay Stock Exchange on Tuesday. , where its stock is listed, asked for an explanation regarding the report.
The BusinessWorld report came on Friday after shares in Vodafone Idea surged 21 per cent. The stock jumped another 6 percent on Monday, ending its busiest session in nearly two years.
However, the stock fell more than 5 percent in heavy trading on Tuesday after the company's clarification.
Starlink, Musk and SpaceX – Musk's rocket company, which owns Starlink – did not immediately respond to a Reuters request for comment.
Vodafone Idea hasn't reported a profit since it was founded in 2018 – a merger of UK-based Vodafone's Indian unit with Aditya Birla Group's Idea Cellular – as it loses subscribers to Bharti Airtel and Reliance Industries' Jio .
What's more, the Indian government owns about a third of Vodafone Idea after it reshared all the fees it owed the company for airwaves and spectrum usage.
Vodafone Idea's financial woes make it an unattractive partner, says Karan Tauran, analyst at Elara Capital.
“On the one hand, they are struggling to raise more cash, and on the other hand, they have a lot of debt to service,” Tauran said.
While Vodafone Idea does not have a satellite company, Bharti-backed OneWeb and Reliance's Jio Satellite Communications have regulatory approval to operate in India.
UK-based Vodafone is partnering with Starlink rival Amazon.com's Kuiper for internet networks in Europe and Africa. Kuiper does not work in India.
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