India: Airtel board okays proposal to raise $3b via debt, equity

Photo: Bloomberg

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

 

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.