New Delhi: The Supreme Court on Wednesday dismissed a government petition challenging a telecom tribunal order directing it to clear Bharti Airtel Ltd’s acquisition of Telenor India without insisting on a bank guarantee for almost Rs1,499 crore.
P.S. Narasimha, representing the government, told the court it had issued guidelines that required the bank guarantee to inspite of a stay order secured by Airtel in any court in the country.
“They must provide the bank guarantee to the extent of one-time spectrum charges payable by them, to the tune of Rs1499 crore", Narasimha added.
The department of telecommunications (DoT) had challenged an order passed by the Telecom Disputes Settlement & Appellate Tribunal (TDSAT), which ordered the government to clear the deal without demanding a bank guarantee.
Airtel plans to buy Telenor India in a no-cash deal and take over its outstanding spectrum payments of Rs1,650 crore. The deal will help it narrow the revenue market share gap with the emerging Vodafone India-Idea Cellular combine, which will become the country’s largest phone company after their merger.
The proposed acquisition has already been cleared by Competition Commission of India (CCI), the market regulator Sebi and stock exchanges BSE and NSE, and it is awaiting telecom department’s nod.
Airtel and Telenor had signed the agreement for merger on February 2017 under which Airtel will acquire Telenor India’s running operations in seven circles — Andhra Pradesh, Bihar, Maharashtra, Gujarat, UP (East), UP (West) and Assam.
As part of the deal, Airtel will assume the Telenor unit’s liabilities related to licence fees and lease obligations for phone towers, a Telenor spokesman said on Thursday. The transaction, which won’t involve any cash payments to Telenor, will give Airtel access to 44 million customers (increasing its user base to 307 million), 43.4 megahertz (MHz) of spectrum in the 1,800MHz band and 20,000 base stations.
PTI contributed to the story.