New Delhi, April 1 -- Vodafone Idea share price rallied as much as 20 per cent on Tuesday to Rs.8.15 apiece on the NSE as the government is set to become the telecom company's largest shareholder by converting its spectrum dues into equity.

The government has decided to convert Rs.36,950 crore worth of the company's dues into equity, which will raise its stake in Vodafone Idea to 48.99 per cent from 22.6 per cent earlier.

Under this agreement, Vodafone Idea will issue 3,695 crore equity shares with a face value of Rs.10 each at an issue price of Rs.10 each following the necessary approvals from relevant authorities, including the Securities and Exchange Board of India. The issue price of Rs.10 is at a 47% premium to Vodafone Idea's last...