Vodafone, Idea may take legal action against Aircel to recover dues

Vodafone India and Idea Cellular are likely to take legal action against Aircel in the next few days to recover their dues, according to people aware of the matter, which will make the duo the first major telecom operators to take such a step against the debt-laden carrier.

Aircel, owned by Malaysia’s Maxis, owes about Rs 60 crore to Idea Cellular including interconnect usage charges (IUC), and a similar estimated amount to Vodafone India, said one of the persons, who did not wish to be identified.

Executives from both claimants told ET on condition of anonymity that their legal teams were preparing to head for the courts if Aircel did not return their dues.

The two operators may initially have to approach the interim resolution professional, Deloitte’s Vijaykumar V Iyer to recover dues and in case there is dispute over the amount, they would move National Company Law Tribunal (NCLT), executives said.

“We are bound by confidentiality obligations and are unable to comment on client-specific matters,” Iyer told ET.

ET’s queries to Vodafone India, Idea and Aircel remained unanswered till late evening on Friday.

Vodafone India, the country’s number two carrier, and Idea Cellular, the No. 3 operator, which are merging their operations, have already disconnected their interconnect network with Aircel, owing to which customers of Aircel would not be able to make calls to or receive calls from the users of its larger rivals.

Aircel, along with its two units, moved the NCLT’s Mumbai bench for bankruptcy protection, because of its inability to service debt of about Rs 50,000 crore, including Rs 19,889 crore owed to operational lenders, due to falling revenue, profitability and cash flows. The petition was admitted less than two weeks ago.

Banks had accepted Aircel’s request to undertake strategic debt restructuring. However, the Reserve Bank of India’s decision to scrap loan recast schemes left the company with no option but to file for bankruptcy under the Insolvency & Bankruptcy Code.

The interim resolution professional now needs to try to get the operations going as well as find a way to repay the lenders.

The NCLT said it admitted the telco’s plea because it believed there was potential to revive the business, given the company’s revenue generation and assets of more than Rs 32,000 crore worth, including spectrum.

Aircel has to fight other legal battles as well. Swedish telecom equipment maker Ericsson has moved the Delhi High Court against Aircel and its units for recovery of arrears worth Rs 251.40 crore. Tower firms GTL Infrastructure and American Tower Corp too had earlier moved the Delhi High Court to recover Rs 912 crore and Rs 224 crore respectively from Aircel.