Airtel clears high-cost spectrum liabilities with Rs 7,904 crore pre-payment

Bharti Airtel, India’s second-largest telecom operator, announced on Friday that it has prepaid Rs 7,904 crore to the Department of Telecom (DoT). This prepayment aims to clear high-cost deferred liabilities for spectrum acquired in the years 2012 and 2015.
Airtel mobile network IndiaWith this transaction, Airtel has fully settled its deferred liabilities from these periods, which carried some of the highest interest rates at 9.75 percent and 10 percent, respectively. The strategic move follows a similar prepayment in January, when the company paid Rs 8,325 crore to reduce its 2015 spectrum liabilities.

The 2015 spectrum auction saw Airtel acquire 111.6 MHz of spectrum for a total of Rs 29,130.20 crore, out of which Rs 7,832.58 crore was paid upfront as mandated. Further reinforcing its commitment to financial prudence, Airtel had also prepaid Rs 8,024 crore in July last year to settle additional liabilities from the same auction.

Airtel attributes these prepayments to its ability to access a well-diversified range of capital and financing options. This financial strategy has provided the company with enhanced flexibility in its capital structure, allowing it to optimize financing costs and capitalize on opportunities for significant interest savings.

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