Barely few minutes into trading and the stock price of Idea Cellular reached a two-month high climbing over 8% on the BSE Sensex.

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At 0923 hours, Idea’s shares were up 5.02% or 5.25 points at Rs 109.75 per share on the BSE Sensex.

The telecom arm of Aditya Birla Group has announced its intension to raise additional funds ahead of its merger with Vodafone.

Idea’s a two-part plan to raise Rs 6,750 crore.

The board of Idea Cellular approved raising about Rs 3,250 crore from entities under the promoter Aditya Birla Group (ABG) and constituted a committee to evaluate potential routes for raising further capital of up to Rs 3,500 crore, the operator said in an exchange filing on Thursday.

“The AB group is in the process of creating a large digital infrastructure, and to contribute significantly towards fulfilment of the Digital India vision. At a time when the telecom industry is going through a challenging environment, the equity infusion by the group in Idea is another step towards reinforcing the group’s commitment (towards telecom business),” Kumar Mangalam Birla, chairman, Idea Cellular, said.

What the higher investment in the company could entail would be higher decision making power for the AB group post its upcoming merger which was slated for completion in March 2018.

“Following the investment from ABG, the investment group will increase its stake to 26% of the merged entity, while Vodafone’s stake will stand at 47.5%,” a report by Telecoms said on Friday.

Vodafone and Idea Cellular will use the fund infusion to pare debt.

The net debt of Vodafone was estimated to be Rs 6,1830 crore, while Idea’s stood at nearly Rs 57,000 crore, as on September 2017.

Ahead of the merger, Vodafone was reportedly cautious of Idea’s losses that were encountered by the company post the M&A announcement last year.

In the second quarter of FY18 alone, Idea posted a loss of Rs 1,107 crore. The company asked Idea to fund the losses incurred before the deal closed.

As per the Idea-Voda agreement, the net debt-to-Ebitda of the merged entity was not to exceed 6.5 times.

Post-merger, Vodafone agreed to sell close to 2.5% stake to the promoters of Idea Cellular for Rs 1,960 crore, according to the revised terms of the agreement.

The net debt of Vodafone-Idea merge-company was Rs 1,106 billion (Rs 1.1 lakh crore), as estimated by JM Financial as on September 2017.

This implied leverage ratio being 6.6x based on trailing 12 months Ebitda, the report added.