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More trouble is brewing for beleaguered telecom operator Aircel, with its Malaysian promoter Maxis Communications deciding against pumping additional funds into the company. Aircel was weighing various options, including venturing into 4G services through partnerships, but this requires fresh investments.
“Global Communication Services Holdings (GCSH) has completed all its obligations to fund Aircel in the past. Aircel shareholders have invested $7 billion to date with zero return. Additional funding by shareholders is unviable, given industry competition, and onerous legal and regulatory action,” GCSH, a Mauritius-based subsidiary of Maxis Communications, said in an email response to BusinessLine .
According to sources close to the development, this follows a Joint Lenders’ Forum meeting held on February 20, wherein the lenders had sought additional funding from shareholders.
Led by State Bank of India, the lenders, including China Development Bank, Bank of Baroda, Canara Bank and Punjab National Bank, also stated that Aircel will have to cease operations in case shareholders decline to infuse funds.
Maxis holds a 74 per cent stake in the company, while the remaining 26 per cent is held by Sindya Securities & Investments.
Aircel, in its board meeting, also said that the Department of Telecommunications is unlikely to release its ₹450-crore bank guarantee in the wake of recent reports on its insolvency, sources said.
Earlier in the month, three board members — Suneeta Reddy, Uthaya Kumar and Umesh Jain — resigned. One of them said there were multiple issues, including failure to take the company to Srategic Debt Restructuring (SDR) and lack of contingency plans. The director also claimed that the crisis could have been averted if Aircel had brought in a corporate debtor and put a solvency plan in place.
Later, on February 18, Aircel inducted three new board members — Prakash Radheshyam Mishra, Sandeep Vats and Lakshmi Subramanian — in place of those who resigned.
A source close to Aircel said: “The management had a plan to make the company viable and successful, including engaging with bankers for SDR. This was signed on January 25, but the RBI, in a February 12 circular, cancelled all SDRs and CDRs and mandated all resolutions have to be made in 180 days”. Aircel is now approaching the NCLT for revival, he added.
An e-mail sent to Aircel went unanswered at the time of going to press.
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