The development follows the proposed merger with Reliance Communications (RCom) being called off in October.
The lenders will meet this month to take a call on the company’s debt restructuring plan. They have also asked the promoters to bring in Rs 4,000 crore of additional equity.
Aircel has decided to exit six important circles in India to focus on its profitable circles. It is in discussions with the lenders to restructure debt, a company spokesperson said.
According to the lenders, the company has already defaulted on its loans and has pledged its entire shareholding with them against the debt. The lenders’ warning comes as the company suffered a loss of Rs 4,319 crore on operating income of Rs 11,630 crore in 2016. Financials for the current calendar year was also not good and it would widen the company’s losses, a banker said.
So far, Maxis Communications of Malaysia (parent of Aircel) has provided Rs 33,000 crore to the company but that has failed to make a dent in the Indian market because of intense competition from Reliance Jio. Till recently, Aircel, together with two of its wholly owned subsidiaries, ACL and DWL, was providing 2G wireless telecom service in all the 22 circles and 3G services in 13 circles. With the launch of Reliance Jio, it is exiting the 2G business, like other marginal players. Tata Teleservices has also decided to exit its wireless telephony business.
RCom and Aircel had signed binding agreements in September 2016 to merge RCom’s mobile businesses with Aircel. But with the Supreme Court still hearing a 2005 case on the acquisition of Aircel by Maxis, the Department of Telecom refused to give its permission to the merger.