GTL Infrastructure seeks to intervene in Aircel bankruptcy proceedings

MUMBAI: GTL Infrastructure, a telecom tower company, has sought to intervene in the bankruptcy proceedings of Aircel in the National Company Law Tribunal in a bid to recover rentals and get a forensic audit of the struggling telco’s accounts. GTL Infra, which is owed Rs 400 crore by Aircel since November, also wants Rs 12,000 crore from the telco for prematurely terminating tower rental contracts valid until 2030.

Aircel was GTL Infra’s biggest client. In its application, GTL Infra asked for travel restrictions on Aircel’s current directors to be extended to former directors and key executives. The application, seen by ET, names Suneeta Reddy of Apollo Hospitals and Uthaya Kumar and Chan Chee Beng, who were nominated by parent company Maxis Communications Bhd. The three directors resigned just before Aircel’s voluntary bankruptcy filing on March 1 and have been unavailable since, it said.

The tower company noted that while admitting Aircel’s bankruptcy, the bench had acknowledged that due to the “overwhelming” amounts due to creditors, a forensic audit of Aircel’s finances would be ordered. However, in the final order, this has been omitted and should be inserted.

“Intervener (GTL Infra) has also long suspected that there were misstatement of accounts and information by the management of (Aircel),” according to the petition filed with the National Company Law Tribunal.

Aircel has debt of about Rs 50,000 crore and opted to file for bankruptcy after over four months of attempts to settle with lenders. The telco is GTL Infra’s largest customer and contributed 43% of the company’s revenue as of March 2017. GTL Infra is pursuing the recovery of rentals to repay debt. The company had acquired Aircel’s towers expecting to benefit from the telco’s growth prospects. However, the 2G licence allocation scam and the subsequent cancellation of telecom licences disrupted the sector’s business prospects.

The NCLT bench named Vijay Iyer of consultancy firm Deloitte Haskins & Sells as the interim resolution professional for Aircel to start the process of trying to find a way to repay lenders and revive the company. “We are the biggest creditor to Aircel, if you look at the terms governing our acquisition of their tower portfolio and infrastructure provision fee related to tenancy,” said a GTL Infra spokesman.

“A default by Aircel in paying our dues affects all our efforts to repay our lenders. We continue to maintain good quality services for all our customers.” The company is prepared to pursue all legal routes to recover the money due to it, the spokesman added.

GTL Infra told shareholders earlier this month that it may not get any money since it was an unsecured lender and was lower on the priority list – after secured banks or lenders of Aircel – for recovering dues.

GTL Infra bought Aircel’s 17,500 towers for Rs 8,062 crore in 2010. Aircel reduced its footprint in five service areas in 2013 and in December 2017, the privately held operator sent a notice to discontinue lossmaking service areas by tendering airwaves.