Telecom tower firm Bharti Infratel on Thursday said it has reached a settlement with four operators, including Vodafone Idea, that exited from its cell sites before the expiry of their contracts at a payment of around Rs 3,800 crore. The payments include one-time charge of Rs 2,000 crore and rental of around Rs 1,800 crore.
Bharti Infratel Chairman Akhil Gupta during the company's earnings call said that all the charges with Airtel, Tata, Telenor, Vodafone Idea have been settled for all exits that were received up to November 30, 2018.
"As a snapshot, on a consolidated basis, of the the total exit charges approximately Rs 20 billion, which related to Rs 37 billion on 100 per cent basis, we had cash settlement against Rs 20 billion ...," Gupta said.
He said that operators have jointly paid Rs 55 crore in cash to Bharti Infratel during the October-December 2018 period and rest of the payment will made in monthly installments with interest spread over period of 36 months.
"In line with our accounting policy Rs 550 million accounted for revenue in this quarter. Instalment amounting to approximately Rs 900 million per quarter shall be accounted for from next quarter as the revenues for the next 12 quarters," Gupta said.
He said that the third quarter of ongoing financial year recorded the highest gross tower and co-location additions in last five quarters.
The company on Wednesday posted an 11 per cent rise in consolidated net profit at Rs 648 crore for the December quarter.
Consolidated revenues, however, marginally dropped to Rs 3,640 crore, while earnings before interest, tax, depreciation and amortisation (EBITDA) came in at Rs 1,513 crore, 6 per cent lower than the year-ago period.
"With completion of Vodafone Idea merger, we believe the consolidation phase is largely behind us and so are co-locations exits that we have been witnessing. Between Indus and Infratel, there were exits of over 57,000 on a consolidated basis till December 31, 2018 spread over six quarters. We believe industry will now move to higher network roll out," Gupta said.
He said that the merger of Bharti Infratel and Indus Towers is on track and there will be meeting on February 2 to get approval of Bharti Airtel shareholders.
Gupta said that the merger of Bharti Infratel and Indus Towers is expected to be completed in April-June 2019 if there are no unexpected delays at NCLT and Department of Telecom.
Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
