NEW DELHI: Telecom operator Bharti Airtel on Friday informed that it has paid Rs 8,815 crore to the Department of Telecom towards part prepayment of deferred liabilities pertaining to spectrum acquired in the auction of the year 2015. The prepayment is for installments due in FY 2027 and FY 2028.
Over the last four months, Airtel has cleared Rs 24,334 crore of its deferred spectrum liabilities much ahead of scheduled maturities. “These liabilities carried an interest rate of 10% and have been paid off through a combination of strong free cash generated by the business, equity proceeds, and significantly lower cost debt of similar tenor,” said the company in a statement.
Airtel continues to focus on financial flexibility via its capital structure including optimising the cost of financing and capitalising on all opportunities of significant interest saves like this prepayment. In December 2021, the telco had prepaid Rs 15,519 crore to the DoT, clearing all dues relating to airwaves bought in the 2014 sale.
Then Airtel said, these prepayments at an estimate will lead to interest cost savings of at least `3,400 crores.
Last year, the government announced a telecom reform package to rescue the cash-strap telecom Industry.
The package includes deferment of spectrum auction payment due up to four years, a one-time opportunity to opt for deferment of AGR related dues as determined by the Supreme Court by four years and a one-time opportunity to exercise the option of paying interest for the deferment period on the deferred spectrum installments and AGR dues by way of conversion into equity.
However, Airtel has not availed the option of conversion of the interest on deferred spectrum and AGR dues into equity.
Govt’s telecom reform package
Last year, the government announced a telecom reform package to rescue the Industry. The package includes deferment of spectrum auction payment due up to 4 years, one-time opportunity to opt for deferment of AGR related dues as determined by SC by 4 years by supreme Court by four years