Airtel pre-pays Rs 15, 519 crores to clear all deferred liabilities for spectrum acquired in 2014
New Delhi, December 17, 2021
Telecom services provider Bharti Airtel today said it had paid Rs 15,519 crore to the Department of Telecommunications (DoT), Government of India, towards prepayment of the entire deferred liabilities pertaining to spectrum acquired in auction of year 2014.
The company had acquired 128.4 MHz spectrum (including Telenor spectrum) for a consideration of Rs 19,051 crores in the 2014 auction.
These liabilities were due in annual instalments from FY 2026-2027 to 2031-2032 and carried an interest rate of 10% (the highest rate amongst the deferred liabilities and borrowings) and an average residual life of 7+ years.
"The company estimates that the prepayment will likely result in interest cost savings of at least Rs 3,400 crores over the residual life for fully substituted capital," a press release from Airtel said.
"Airtel continues to exercise flexibilities towards a stronger and efficient capital structure. The company welcomes the Department of Telecom’s decision giving the industry the flexibility to prepay their deferred liabilities anytime at their NPV basis the interest rates specified for the respective auction. This allows the licensees to efficiently plan and use their cash flows," the release added.