DoT seeks ₹1,626 cr from Airtel to clear merger with Tikona
NEWDELHI:The department of telecommunications (DoT) has in a letter dated August 17 asked Bharti Airtel Ltd to pay in cash and through a bank guarantee a total of ₹1,626.89 crore to clear its merger with Bharti Digital Networks (formerly known as Tikona Digital Networks).
Airtel has, however, approached the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) seeking a stay on the DoT demand.
DoT asked Airtel to pay ₹185.62 crore in cash. This is the difference between the entry fee payable for unified access service licence in the four telecom circles of Gujarat, Himachal, Uttar Pradesh (east) and Uttar Pradesh (west) and the entry fee already paid by Tikona under unified licence in the 2300 MHz band.
This payment would enable Airtel to also provide voice services using the spectrum in the four circles. Tikona has 20 MHz spectrum in these circles and the Rajasthan circle.
“Bharti Airtel shall (also) submit bank guarantee towards onetime spectrum charges for ₹1,441.27 crore towards spectrum holding beyond 4.4 MHz (under the merger and acquisition guidelines),” the letter said.
Mint has seen a copy of the letter. One-time spectrum charges are payable by companies that want to convert their administered spectrum or spectrum not bought in an auction to liberalised or auctioned spectrum. Auctioned spectrum can be deployed flexibly for any purpose, unlike administered spectrum.
Under the department of telecommunications’s merger and acquisition guidelines, if a transferor (Tikona) holds a part of the spectrum, which (up to 4.4 MHz) has been assigned against the entry fee paid, the transferee (Airtel), at the time of merger, shall pay to the government, the differential between the entry fee and the market-determined price of spectrum from the date of approval of such arrangements by the National Company Law Tribunal (NCLT) on a pro-rata basis for the remaining period of validity of the licence.
In respect of spectrum holding beyond 4.4 MHz, a bank guarantee for an amount equal to the demand raised by the DoT for one-time spectrum charges shall be submitted by transferee (Airtel), pending final outcome of the court case, according to the guidelines.