New Delhi, Sep 23 (PTI) Debt-ridden Vodafone Idea has approached the government for relief on Rs 70,000 crore adjusted gross revenue (AGR) dues after the Supreme Court rejected its curative petition for correction in the calculation of the statutory dues and waiver of penalty and interest thereof, a top company official said.
During the company’s investor call on the Rs 30,000-crore contract awarded to Nokia, Ericsson, and Samsung for the supply for 4G and 5G telecom gears, VIL Chairman Ravinder Takkar said the company has been engaging with senior government officials prior to the court ruling, and even after it.
“While there was hope that the courts will obviously consider the petition, the fact that the court has not done so means that the action and responsibility, in some ways, falls squarely along with the government.
“The government has since asked us to put together a comprehensive view of what we believe would be the right mechanism and request that we can make for addressing this challenge,” Takkar said.
The government holds a 23.2 per cent stake in VIL while promoters — Aditya Birla Group and Vodafone — hold 37.3 per cent stake in the company.
Takkar said there is a clear understanding with the government that VIL should not have to pay something that is a result of a calculation error.
“We are in the process of putting together those requests. We will be engaging again with the government in the coming days on those requests. They are very committed, and continue to be very, very committed to three strong private players. We expect to engage further with the government, and look forward to working with them and finding a solution for this challenge,” Takkar said.
VIL payment obligation to the government stood at Rs 2,09,520 crore as of June 30, 2024, including deferred spectrum payment obligations of Rs 1,39,200 crore and AGR liability of Rs 70,320 crore.
VIL CEO Akshaya Moondra said the Supreme Court has dismissed the curative petition that the company filed to correct the errors and demands and waiver of penalty and interest thereof.
He said as per the apex court, the petition did not meet the criteria laid down for admitting the curative petitions.
“There was no discussion on the merits of the case, while a positive outcome would have no doubt eased the overall liability and enable faster deleveraging, we would like to reassure you that our long-term business plan and revival strategy remains unaffected.
“While the outcome of the curated petition is disappointing, it does not have any impact on the long-term business plan of the company and its existing liabilities,” Moondra said.
He said the company has also submitted a growth plan with banks for raising debt.
Moondra said he expects debt funding to come from banks in 7-8 weeks which it will use for funding its network expansion. He said that the company is in discussion with new lenders to tie up Rs 25,000 crore of funds and Rs 10,000 crore of non-fund based facilities or the letter of credit.
He said one of the major steps in the debt fundraising process was the completion of techno-economic evaluation by an independent third party engaged by SBI.
“This evaluation has been recently completed, and the report has been submitted to all banks and financial institutions, which will allow them to not progress with their internal evaluation and approval processes. We expect the bank funding to conclude the next seven to eight weeks,” Moondra said.
VIL has awarded about a Rs 30,000-crore contract to Nokia, Ericsson, and Samsung to supply 4G and 5G telecom network equipment for three years.
Moondra said the equipment supply is expected to start by the end of next quarter and there will be substantial deployment by the end of the current fiscal year.
The company has earmarked Rs 50,000-55,000 crore for network expansion. VIL said it will initially raise the fund capex from Rs 24,000 crore it raised recently and for the rest it is in discussion with banks. PTI PRS TRB
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