Vodafone Idea may lose Tower Access from November if it fails to repay dues to Indus Towers
The cash-strapped telecom operator Vi Limited, which has over 255 million subscribers, could lose access to its towers in November if it fails to repay dues to Indus Towers. Indus Towers, India’s largest mobile tower installation company, has asked Vodafone India (Vi) to repay debts in order to continue using its towers.
The cash-strapped telecom operator Vodafone Idea (Vi), which has over 255 million subscribers, could lose access to its towers in November if it fails to repay dues to Indus Towers. Indus Towers, India’s largest mobile tower installation company, has asked Vi Limited to repay debts in order to continue using its towers.
An anonymous source told Press Trust of India (PTI) that the development comes after independent directors expressed concerns about Vodafone Idea Limited’s mounting debts (Vi).
According to the Economic Times, Indus Towers held a board meeting on Monday to discuss the company’s mounting trade receivables. Then, they later issued a strongly worded letter to Vodafone Idea (Vi).
Indus Towers reportedly instructed Vodafone Idea to pay 80% of the current monthly dues and settle its debts in the letter. Additionally, it has ordered the corporation to fulfill its monthly obligations in full and on schedule. Another source claimed that American Tower Corporation (ATC), which operates 75,000 mobile towers in India, is considering taking similar measures to collect its debts.
Indus Towers reportedly instructed Vi to pay 80% of the current monthly dues and settle its debts in the letter. Additionally, it has ordered the corporation to fulfill its monthly obligations in full and on schedule.
Another source claimed that American Tower Corporation (ATC), which operates 75,000 mobile towers in India, is considering taking similar measures to collect its debts.
Emails sent to Vodafone Idea (Vi), Indus Towers, and American Tower Corporation (ATC) received no response.
Indus Towers provided Vodafone Idea (Vi) with services worth Rs. 9,446.8 crore. The company paid 3,375 crore to Indus Towers in exchange for an equity investment from Vodafone Idea (Vi).
It may be mentioned that Vodafone Idea (Vi) owes more than Rs 10,000 crore in total tower debt at present. Out of this, the company is estimated to own Rs 6,800 crore alone in Indus Towers and Rs 2400 crore in American Tower Company (ATC).
The financially troubled telco plans to raise Rs 20,000 crore through shares and bank loans. The telco hasn’t yet been able to successfully close any deals, though.
Vodafone Idea (Vi) has put forward a payment plan to Indus Towers in which they state their ability to pay a portion of the invoiced amount until December 2022 and 100 percent thereafter, as well as with the phased payment of the past-due sums that would be collected until December 2022, between January 2023 and July 2023.
Vodafone Idea (Vi) has put forward a payment plan to Indus Towers in which they state their ability to pay a portion of the invoiced amount until December 2022 and 100 percent thereafter, as well as with the phased payment of the past-due sums that would be collected until December 2022, between January 2023 and July 2023.
According to Indus Tower management, the company is negotiating with Vodafone Idea (Vi) to establish a suitable payment plan.
At the end of June, when Indus Towers had 186,474 towers in operation, Vodafone Idea (Vi) was the company’s principal client.
47.76 percent is held by Bharti Airtel. Vodafone Idea (Vi) lost ownership of the business as a result of the merger between Indus Towers and Bharti Infratel.
Vodafone Idea (Vi) had a net debt of Rs 1.98 trillion at the end of June, with nearly Rs 1.16 trillion in unpaid spectrum fees and Rs 15,200 crore in debt to banks and other financial institutions.
