Bharti Airtel’s board on Wednesday approved the telecom operator’s proposal to raise $3 billion (approximate ₹21,100 crore) via debt and/or equity.
The funds will be utilized to help the company pay the department of telecommunications (DoT) its dues estimated to be ₹35,586 crore.
The company’s share closed at ₹460.85 in Wednesday’s trade on the BSE, up 0.4%. The notice to the exchange about the board decision was sent after the market close.
As per a 24 October order of the Supreme Court (SC), the company is required to pay these dues within three months of the verdict in a case that pitched Airtel against DoT and lasted 14 years.
According to a PTI report, Bharti Airtel owes DoT ₹21,682 crore in licence fee and another ₹13,904.01 crore as spectrum usage charges. This does not include the dues of Telenor and Tata Teleservices, telecom companies that Airtel acquired.
The tariff hike by the three operators is the first of its kind in more than a decade after years of competition ensured prices of calls and data services hit rock bottom.
Airtel, reeling under heavy debt and a hit on profitability post the 2016 entry of Reliance Jio, was left with little choice after an adverse 24 October Supreme Court ruling that penalized the companies for what the DoT has maintained was underreporting of revenues by them. The top court imposed a penalty of ₹92,000 on the operators, many of whom have already folded. The operators were given three months to pay the dues.
While Airtel and Vodafone have filed a petition in the SC to review the 24 October order, the government is not considering any proposal on waiver of penalties and interest on outstanding licence fee based on AGR, or on extending the timelines for telecom companies to pay up their statutory dues.
This article was first published on livemint.com