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Bharti Airtel has opted for a four-year moratorium on the repayment of around Rs 3,000 crore of adjusted gross revenue (AGR) dues to the government. The company, however, has decided not to opt for a conversion of interest on the deferred dues into equity for the government.
Last September, the Union Cabinet had announced a telecom reforms package providing a slew of benefits for ease of doing business and liquidity. Telecom companies were offered a four-year moratorium on their AGR dues spectrum dues up to FY17, in line with a Supreme Court order. Both Airtel and Vodafone Idea availed of the offer last October.
About a fortnight ago, the department of telecommunications (DoT) extended the benefit a second time and now offered a four-year moratorium for AGR dues up to FY19.
While Vodafone Idea notified its decision last week to defer the repayment of dues worth Rs 8,837 crore, Bharti Airtel communicated its decision to the government on Thursday. With this, Airtel will be able to get a four-year moratorium on payments.
Vodafone Idea had decided to convert interest with a net present value of Rs 16,000 crore into equity for the government in January. This would give the government a 33 per cent stake in the company. However, the actual allotment of shares has still to take place.
Meanwhile, in a separate development, the Competition Commission of India (CCI) on Thursday approved Google’s proposed acquisition of a minority stake in Bharti Airtel. The deal was cleared on the basis of modifications offered by the acquirer, according to an official release.
Google International LLC and Airtel have entered into an investment agreement to buy a minority and non-controlling stake of 1.28 per cent of equity share capital in the telecom player.
Along with the investment agreement, both companies have also entered into certain commercial deals through their affiliates. The parties also intend to enter into certain other commercial arrangements in future, according to a press statement. Deals beyond a certain threshold require the approval of the regulator, which keeps a tab on unfair business practices in the marketplace.
Google International LLC is a wholly owned subsidiary of Google LLC, which in turn is a wholly owned subsidiary of Alphabet Inc.
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