Vodafone Idea (Vi) has urged the Department of Telecommunications (DoT) to permit the surrender of some spectrum acquired before 2021. This move aims to lower its bank guarantee (BG) requirement for the March 2015 auction from Rs 6,091 crore to Rs 2,900 crore, as the financially struggling telecom firm faces challenges in meeting the payment.
In a letter to DoT Secretary Neeraj Mittal, Vi stated that it cannot provide a Rs 6,091-crore BG or pay Rs 5,493 crore in cash to cover the shortfall from the 2015 spectrum purchase. The telecom company, formed through the 2018 merger of Vodafone India and Idea Cellular, said this is its last pending securitisation requirement from the 2015 auction.
Instead, Vi proposed utilization of excess payments made in previous auctions or bank guarantees and cash deposits already submitted with DoT for regulatory obligations. The telco highlighted it had made excess payment of Rs 9,900 crore in the 2016 auction and Rs 8,800 crore in the 2012 and 2014 auctions. Vi added that the matter of the surrender of pre-2021 spectrum has been under discussion and that approving this request can reduce its spectrum obligation by Rs 4,800 crore.
The company also said that it has already provided DoT with Rs 5,800 crore in BGs for regulatory matters and Rs 2,450 crore in cash deposits in 2015, when there was an internal restructuring of Vodafone Group companies. Overall, Vi contended that DoT has Rs 26,950 crore in securitisation options available, like surplus payments from earlier auctions, and asked the department to consider these options instead of taking coercive action.
In addition, Vi CEO Akshaya Moondra requested DoT to speed up the process of converting the company’s outstanding regulatory dues—like adjusted gross revenue (AGR) and spectrum payments—into equity. These dues pertain to spectrum purchased in the 2012, 2014, 2015, and 2016 auctions.
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Source: Moneycontrol.
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