Aircel is in advanced stages of discussions to pay a penalty of Rs 1,000 crore to independent tower operator GTL Infrastructure following its failure to provide the promised number of tenancies.
Pact soon
An agreement is expected to be signed between the companies soon, sources close to the development said, adding that the payment of the penalty would be staggered over a one-year period. Tenancies are the number of operators hosted on a telecom tower.
Aircel is paying the penalty to avoid GTL Infrastructure invoking bank guarantees as the Mumbai-based shared passive infrastructure company was mulling invoking bank guarantees in case the penalties were not paid, the sources, who declined to be identified due to the sensitivity of the issue, said.
The discussions between the companies were on for some time, with Aircel accepting to make the payments, while finalising the quantum of the penalty had delayed the formal agreement.
While Aircel did not respond to the e-mails seeking a response, while a GTL Infrastructure spokesman declined to comment on what he termed as “speculation”.
The dispute erupted after Aircel, which sold its tower business to GTL Infrastructure in 2010, agreed to provide 20,000 new tenancies (operator per tower) by March 2013. Aircel, in which Malaysia’s Maxis Communications holds a majority stake, could only provide about 2,500 tenancies, sources added.
GTL Infrastructure, a Global Group company, had acquired the GSM operator’s towers in a $1.8-billion (about Rs 8,160 crore) all-cash deal.
At the time of the acquisition, Aircel had 17,500 towers that were later merged with GTL Infrastructure’s 15,000 towers, taking the total to 32,500.
Key customer
GTL Infrastructure, a company promoted by Global Group, had clinched the deal backed by a $1.2-billion (Rs 5,440 crore) loan from State Bank of India, while it had also Aircel as its key customer.
GTL Infrastructure, which has operations across all the 22 telecom circles, had floated a special purpose vehicle Chennai Network Infrastructure Ltd for the acquisition of Aircel’s tower assets.