Bharti Airtel on December 17 said that it has made an advanced payment of Rs 15,519 crore to the telecom department for the entire deferred liabilities on the spectrum it acquired in 2014.
The company had acquired 128.4 MHz spectrum, which includes the Telenor spectrum, for a consideration of Rs 19,051 crore in the 2014 auction, it said in a statement.
These liabilities were due in annual instalments from FY2026-27 to FY2031-32 and carried an interest rate of 10 percent – the highest among the deferred liabilities and borrowings – and an average residual life of more than seven years, it said.
The company estimates that the prepayment will translate into interest cost savings of at least Rs 3,400 crore over the residual life for fully substituted capital. It said that it 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.
Bharti Airtel share price dropped 3 percent intraday to Rs 661.30 on December 17 after the advance payment was declared.
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