Govt plans to transfer BSNL land, debt to SPV; assets undervalued, says union

Press Trust of India New Delhi | Updated on August 08, 2019 Published on August 08, 2019

The SPV is proposed to sell the land parcels and pay off BSNL’s debt, which is estimated to be around ₹15,000 crore.   -  SOMASHEKAR G R N

Final valuation will be done before disposing of the land parcels, says management

The government is mulling transfer of land assets and loans of loss-making BSNL to a special purpose vehicle in an effort to make the state-owned telecom firm a debt-free entity.

However, the BSNL Employees Union has alleged that the land parcels proposed to be transferred to the SPV at a value of ₹20,210 crore are in prime locations in big cities and are “grossly undervalued”.

The BSNL management denied the allegations saying the valuation has been done only on an indicative basis and final valuation will be done before disposing the proposed land parcels. The SPV is proposed to sell the land parcel and pay off BSNL debt estimated to be around ₹15,000 crore.

“It is astonishing to note that in the name of monetisation of lands, for the purpose of making BSNL a debt-free company, BSNL’s lands are being transferred to the SPV at a “throw-away price,” the union said in a letter to the Telecom Secretary.

The union said the market value of the 63 land parcels identified for transfer to SPV is very high. However, these are being transferred at a “dirt cheap price” in the name of book value.

When contacted, BSNL Chairman and MD, PK Purwar, said, “Such allegations are baseless and incorrect since the valuation has been done on an indicative basis for the purpose of preparation of Cabinet note. Final valuation will be done by a government registered valuer. The SPV proposed is also 100 per cent owned by government of India like BSNL”.

The union said that it gathered information on the land parcel in Chennai and Kerala circle and found them grossly under valued.

Value of Chennai, Kerala circle

“In Chennai City, 8 land parcels are being transferred by BSNL to the SPV. The total market value of these land parcels has been determined by the BSNL management as ₹2,753.67 crore. The market value of these comes to ₹3,867.89 crore. Thus, it could be understood that in Chennai city alone, BSNL’s land parcels are being under valued by ₹1,262.89 crore,” the letter said.

It also alleged that BSNL has identified 10 acres of land in the Regional Telecom Training Centre in Thiruvananthapuram at a value of ₹10 lakh/cent (about 435.5 sq ft), while Kerala government six years ago paid ₹15 lakh/cent compensation for road widening.

“The SPV, which has been created to sell BSNL’s land, is going to hand over these lands to the corporates and to the entrepreneurs, at a throw away price. We are afraid that, in this process, BSNL is going to incur a massive financial loss,” the union said in the letter.

Published on August 08, 2019

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