India's Airtel prepays GBP 1.5bn to clear spectrum dues

India's Airtel prepays GBP 1.5bn to clear spectrum dues

Indian telecom operator Bharti Airtel on Friday said it has paid INR 15,519 crore (GBP 1.5bn) to the government towards prepayment of its entire deferred liability of spectrum acquired in the 2014 auction.

According to a statement from the Indian multinational telecommunications services company, it had acquired 128.4 MHz spectrum (including Telenor spectrum) for consideration of ₹ 19,051 crores in the 2014 auction.

"These liabilities were due in annual installments 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," it said.

The company estimates that the prepayment to the Department of Telecom (DoT) will likely result in interest cost savings of at least ₹ 3,400 crores over the residual life for fully substituted capital.

"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," it said.

Headquartered in India, Airtel is a global communications solutions provider with over 480 million customers in 17 countries across South Asia and Africa.

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