Telenor allowed to offset Rs 1,660 crore in spectrum cost
Norwegian telecom operator Telenor on Friday said it has been allowed to offset Rs 1,660 crore against payment due for spectrum bought in November 2012.
New Delhi: Norwegian telecom operator Telenor on Friday said it has been allowed to offset Rs 1,660 crore against payment due for spectrum bought in November 2012.
"On 31 March 2014, Indian authorities confirmed that Telenor's Indian subsidiary Telewings will be granted an offset of the entry fee of Rs 16.6 billion paid by Unitech Wireless in 2008 against the remaining instalments," Telenor said in a regulatory filing.
The Empowered Group of Ministers decided in October 2012 to allow telecom companies to adjust payments made earlier for licences cancelled by the Supreme Court in February 2012. The benefit was available only for companies without criminal proceedings pending against them in the 2G case.
Uninor was created as a joint venture between Unitech Wireless, the company which got licences in 2008, and Telenor. All 22 licences of Uninor were cancelled by the apex court.
Telenor parted ways with Unitech Wireless and bid in the auction through a new entity - Telewings Communications. It has to pay Rs 4,018.28 crore for spectrum in six circles -- Andhra Pradesh, Bihar, Gujarat, Maharashtra, UP East and UP West.
"The one-time effect of the licence offset will be recognised in Telenor's Q1 results as other income," Telenor said.
The Norwegian firm said it will also save Rs 170 crore as accrued interest is reduced following the lowering of licence debt.
"These effects are partly offset by a deferred tax expense of Rs 5.6 billion. The cash effects from the granted offset will occur in connection with the remaining instalments, scheduled for 2015-2024," Telenor said.
Telenor will share details of the gains in its first-quarter results of 2014 on May 7.