Aircel Blames Jio For Their Bankruptcy; Idea Finally Launches 4G, But Only For Employees!
Unable repay their debt of Rs 17,479 crore to a consortium of banks, Aircel, along with Aircel Cellular and Dishnet Wireless have filed for bankruptcy.
March is an important month for the business community, as a new financial year starts at the end of it, and new beginnings are planned.
For the telecom industry, the month has begun on a sad note.
India’s 6th largest telecom company Aircel has finally filed for bankruptcy, as they unable to cope with the mounting debt of Rs 17,479 crore.
SBI, India’s largest bank has the maximum share in this amount due, and banking legends are actually scared.
Aircel’s founders are staring at a massive loss of $7 billion or Rs 46,000 crore, for their years of investment in India.
Meanwhile, Idea has finally launched their 4G services, though, only for employees as of now.
Aircel: Jio Is To Be Blamed For Our Destruction
Unable repay their debt of Rs 17,479 crore to a consortium of banks led by SBI, T Ananda Krishnan led Aircel, along with Aircel Cellular and Dishnet Wireless have filed for bankruptcy in Mumbai’s National Company Law Tribunal (NCLT).
As of July 2017, they had 89.9 million customers, pan-India, and dominated these 4 circles: Tamil Nadu, Assam, North East and Jammu & Kashmir.
As per RBI’s guidelines, they had resorted to Strategic Debt Restructuring starting January 2018, but no results came out.
Indirectly, they have blamed Reliance Jio for their destruction, as they were unable to cope with the tsunami, and had to give in finally.
In a statement, Aircel said,
“The Board of Directors acknowledged that it has been facing troubled times in a highly financially stressed industry, owing to intense competition following the disruptive entry of a new player, legal and regulatory challenges, high level of unsustainable debt and increased losses. This has caused significant negative business and reputational impact on the company,”
Business tycoon T Ananda Krishnan is Malaysia’s 3rd richest person, and as per financial reports, Aircel’s holding company Maxis Communications Bhd, along with his private investment vehicle Usaha Tegas Sdn is expected to lose up to $7 billion in this fiasco.
Krishnan invested $800 million to buy Aircel, 12 years ago, in Tamil Nadu from where they started the business.
Saudi Telecom Co. owns a 25% share in Maxis Communications Bhd, while 30% is held by so-called Bumiputera or ethnic Malay investors.
Now, the question arises: What is the future of telecom industry in India? Consolidation process which started in 2017, and now ended with Aircel’s demise (although talks for a merger with RCom was on, it failed).
Now, only Airtel, Jio, Vodafone-Idea and BSNL remain the players of this battle.
2018 seems to be brutal, and ruthless for them.
Idea: 4G Finally Launched
Effective today, Idea Cellular has officially launched their 4G services, only for some employees, in some select circles.
In the next 90 days, Idea will launch 4G services pan-India, across 30 cities from four circles: Maharashtra & Goa, Kerala, Gujarat, and Andhra Pradesh & Telangana.
Under the first phase, some of the cities where their 4G would be launched are Ahmedabad, Calicut, Hyderabad, Kochi, Nagpur, Nashik, Pune, Rajkot, Surat, and Thiruvananthapuram, among others.
Reports are also in that they are partnering with some handset makers to provide bundled 4G plans, at a lesser cost.
We will keep you updated.