Tata group pays Rs 50k-cr of dues to complete sale of telco unit to Airtel

Tata group pays Rs 50k-cr of dues to complete sale of telco unit to Airtel

New Delhi, Jul 8: Tata group paid lenders and the government about Rs 50,000 crore ($7.3 billion) to help complete the sale of its mobile-phone services business to Bharti Airtel Ltd., a deal that was announced almost two years ago.
Tata Sons Pvt., the group holding company, paid the Department of Telecommunications Rs 10,000 crore late last month, days after settling all pending loans worth Rs 40,000 crore owed by unit Tata Teleservices (Maharashtra) Ltd, the Mumbai-based group said.
“All debt obligations of the consumer mobile business of Tata Teleservices have been repaid as per schedule,” a Tata Group spokeswoman said in an emailed statement.
The disposal of Tata’s phone business was part of an industry consolidation triggered by the entry of billionaire Mukesh Ambani’s Reliance Jio Infocomm Ltd. in 2016. The new operator with deep pockets stormed the market with free calls and cheap data, forcing many of the incumbents, already struggling under a pile of debt, to exit or merge with rivals.
Tata, the salt-to-software conglomerate, agreed in October, 2017 to dispose of the unprofitable businesses under Tata Teleservices Ltd. and Tata Teleservices (Maharashtra) and merge them with billionaire Sunil Mittal’s Bharti Airtel, which is now the nation’s second-biggest carrier.