NCLT permits UVARCL to transfer right of use of spectrum

Rajesh Kurup Mumbai | Updated on June 18, 2020

The National Company Law Tribunal (NCLT)-Mumbai, which approved the takeover of the defunct Aircel, has permitted UV Asset Reconstruction Company Ltd (UVARCL) to transfer or sell spectrum.

The tribunal, granting the request to transfer spectrum rights, said that the Department of Telecommunications (DoT) was represented in all meetings of the Committee of Creditors (CoC) from the third meeting onwards.

The CoC had earlier sought permission for usage of spectrum by a buyer “free of any encumbrance”. It also sought implementation of the resolution plan for fibre and other assets held by Aircel.

“…and that the Resolution Plan (RP) was also considered in their presence and no objection has been raised thereon,” the NCLT said in its order.

The CoC had earlier sought permission for usage of spectrum by a buyer “free of any encumbrance”.

Aircel has spectrum in the 900 MHz, 1,800 MHz and 2,100 MHz frequencies across the Mumbai, Delhi, Karnataka, Andhra Pradesh, Rajasthan and Tamil Nadu circles. These are valid till 2026.

On June 9, the tribunal had approved the takeover of Aircel’s assets by UVARCL.

READ: UVARCL gets NCLT nod to take over Aircel

Aircel, which owes about ₹20,000 crore to a clutch of 12 financial institutions, was being managed by an RP. In May 2019, the creditors of beleaguered telecom operator Aircel had approved the partial liquidation of the company, which did not include its bulk SMS and enterprise businesses.

Lenders’ chart

State Bank of India has the biggest exposure of 36.6 per cent, followed by Punjab National Bank at 15.1 per cent, China Development Bank Corporation: 13.7 per cent and Bank of Baroda: 10.5 per cent. Canara Bank, Nordic Investment Bank, AB Svensk Exportkredit, Exim Bank and Syndicate Bank are the other lenders to Aircel.

On February 27, 2018, Aircel filed for bankruptcy protection with the NCLT in Mumbai after its Malaysian promoter Maxis Communications decided against pumping additional funds into the company. The tribunal admitted Aircel’s application on March 12, 2018, and appointed the Resolution Professional (RP).

In April last year, Maxis Communications infused an additional ₹95 crore in Aircel to enable the telecom operator to pay salaries and meet certain expenses. The move — which was more of a goodwill gesture than an investment — came after the Malaysian parent declined in February to provide any more funds.

ALSO READ: Maxis gives Rs 95 crore to Aircel to pay staff salary

Published on June 18, 2020

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