 "Vodafone Idea accepts 4-year payment moratorium on spectrum dues")
Vodafone Idea (Vi) has decided to avail the four-year moratorium on spectrum dues. This will give the stressed telecom operator a fresh lease of life and allow it to make investments in new services and technology.
Telcos have been given time till October 29 to communicate whether they wish to avail a moratorium on payment of spectrum dues and adjusted gross revenue (AGR).
The department of telecom (DoT) has given them 90 days to consider the option of converting the interest that will accrue during the moratorium period into equity.
The government has also informed the companies about modalities of debt-to-equity conversion, relevant date for pricing the shares and the pricing formula, among others.
While Vi has decided to avail a moratorium on spectrum dues, it is yet to take a similar call on AGR.
In a stock exchange filing, the company said its board of directors have approved the option of deferment of the company’s spectrum auction instalments for a period of four years (October 2021 to September 2025).
“The other options offered in the notification by DoT will be considered by the board within the stipulated time frame,” it said.
The company’s stock gained 6.4 per cent on Wednesday and closed at Rs 10.64 on the BSE.
On September 15, the Union Cabinet approved a relief package for the telecom sector that included a four-year moratorium on AGR and spectrum payments. It also included reduced bank guarantees and the option of converting operators’ principal statutory dues into equity at the end of the moratorium period – or after four years.
Vi’s total gross debt as of June-end stood at Rs 1.91 trillion. It comprised deferred spectrum obligations, AGR liability and bank loans. This includes deferred spectrum payment obligations of Rs 1.06 trillion and AGR dues of over Rs 62,000 crore.
Chief executive officer Ravinder Takkar had earlier said that the reforms package will help address the concern of investors and create a great opportunity to get funding.
“I think the four-year moratorium period is long enough to get the company back on track,” he had said.
Telcos have been given time till October 29 to communicate whether they wish to avail a moratorium on payment of spectrum dues and adjusted gross revenue (AGR).
The department of telecom (DoT) has given them 90 days to consider the option of converting the interest that will accrue during the moratorium period into equity.
The government has also informed the companies about modalities of debt-to-equity conversion, relevant date for pricing the shares and the pricing formula, among others.
While Vi has decided to avail a moratorium on spectrum dues, it is yet to take a similar call on AGR.
In a stock exchange filing, the company said its board of directors have approved the option of deferment of the company’s spectrum auction instalments for a period of four years (October 2021 to September 2025).
“The other options offered in the notification by DoT will be considered by the board within the stipulated time frame,” it said.
The company’s stock gained 6.4 per cent on Wednesday and closed at Rs 10.64 on the BSE.
On September 15, the Union Cabinet approved a relief package for the telecom sector that included a four-year moratorium on AGR and spectrum payments. It also included reduced bank guarantees and the option of converting operators’ principal statutory dues into equity at the end of the moratorium period – or after four years.
Vi’s total gross debt as of June-end stood at Rs 1.91 trillion. It comprised deferred spectrum obligations, AGR liability and bank loans. This includes deferred spectrum payment obligations of Rs 1.06 trillion and AGR dues of over Rs 62,000 crore.
Chief executive officer Ravinder Takkar had earlier said that the reforms package will help address the concern of investors and create a great opportunity to get funding.
“I think the four-year moratorium period is long enough to get the company back on track,” he had said.
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