Tata Group pays back Rs 17,000 crore of teleservices debt to banks

Tata group earlier this week paid around Rs 17,000 crore to banks to settle a lion’s share of the outstanding debt of Tata Teleservices, said two people close to details. After the payment around Rs 6,000 crore of debt remains with the company.

A third person said the group has promised a second tranche of payment towards the end of the month. “The payment is a clear indicator that Tatas are serious about consolidating the remaining telecom and media businesses,” he said.

As per the latest filings with the Ministry of Corporate Affairs, the company had around Rs 22,000 crore of rupee-denominated debt. The repayment has been made to a consortium of bankers led by State Bank of India.


Tata group and State Bank of India declined comment.

Tata Sons has issued corporate bonds to raise these funds and repay banks.

Last October, Tata Teleservices folded its mobile operations into Bharti Airtel in a no cash, no debt deal. At the time Tata had said it was retaining the much sought after enterprise business, which includes providing leased lines for Internet and wired phone lines to offices.

“Tata is also in initial stages of exploring combination of its enterprise business with Tata Communications and its retail fixed line and broadband business with Tata Sky,” the group had said in a statement.

Earlier, Bharti Airtel and the Tata group have held talks for the telecom bellwether to buy the combined telecom assets of Tata group. One of the people quoted above said this was a key motivation to quickly resolve Tata Teleservices’ debt dilemma.

The company had been reeling under industry pressure and surplus debt for some years. In 2014 Tata Teleservices had reported its net worth had been wiped out.