Bharti Airtel has announced that it has prepaid Rs 8,024 crore to the Department of Telecom (DoT) as a part of the deferred liabilities for the spectrum, acquired in the auction which was held in 2015. The instalments for the spectrum acquisition had an interest rate of 10%, and Airtel decided to prepay them, taking advantage of lower-cost financing options available to the company.
By making this prepayment, Airtel aims to enhance its financial flexibility in its capital structure and optimize the cost of financing using various opportunities for significant interest savings. The telecom giant continues to have access to diversified sources of capital and financing.
In the previous year's auction, Airtel acquired 19867.8 MHz spectrum in various frequency bands, including 900 MHz, 1800 MHz, 2100 MHz, 3300 MHz, and 26 GHz, at a cost of Rs 43,084 crore for a 20-year term. This acquisition also allowed Airtel to reduce its payout towards spectrum usage charge (SUC) significantly and eliminate the adverse SUC arbitrage compared to new entrants.
With the spectrum acquisition, Airtel has been rapidly rolling out 5G services across the country. The company boasts the largest pool of low and mid-band spectrum (Sub GHz/1800/2100/2300 bands), enabling it to offer the best 5G coverage. Furthermore, it holds massive capacities in the 3.5 GHz and 26 GHz bands, enabling Airtel to create 100X capacities at minimal costs.
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Airtel serves more than 500 million customers across 17 countries in South Asia and Africa. With its strategic spectrum acquisition and prepayment of deferred liabilities, the company aims to maintain its strong position in the competitive telecom market while providing enhanced services to its vast customer base.
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Inputs from IANS
