Country’s last small telecom operator Aircel (Aircel Cellular Ltd) and its two units (Dishnet Wireless Ltd and Aircel Ltd) have filed for bankruptcy in the National Company Law Tribunal (NCLT). The telecom operator has been under highly financially stress due to intense competition in the telecom sector. Also, financial institutions crack down on large loan defaulters as fuelled it further.
“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,” the company said in a press statement.
Aircel’s detailed discussions with the financial lenders and shareholders failed to yield any agreement with respect to the restructuring of its debt and funding. According to the latest media reports, the operator’s debt now stands at around Rs 15,500 crore.
“No agreement could be reached. Under current circumstances, especially after the 12 February 2018 RBI guidelines, the Company believes resolution process under the Code is an appropriate recourse,” the company further said in a press statement.
However, the company said that the Corporate Insolvency Resolution Process (CIRP) or bankruptcy filing is not a proceeding for liquidation. Rather it’s a process to find the best possible resolution for the current situation and that would be in the best interest of vendors, distributors and employees, among others. Thus to keep the company going and manage its operations.
Aircel’s bad luck started especially after with the entry of Reliance Jio in the Indian telecom market. To fight the intense tariff war, the telecom operator announced a merger with Reliance Communications (RCom). But, unfortunately due to various issues and hurdles it faced, the deal lapsed in September 2017. In the same time, RCom winded up its wireless business.
Few days before, Aircel seeked Telecom Regulatory Authority of India (TRAI) intervention to allocate additional Mobile Number Portability (MNP) codes to generate UPC for its subscribers. It has been working hard to restore its network issue, which got severe when its Infra provider GTL Infra turned off as much as one-third of their total sites in different licensed service areas across the country.
The telecom operator is now working with other telecom operators on intra circle roaming arrangements. Recently, Aircel was able to sign a deal with state-run telecom operator BSNL in Tamil Nadu telecom circle. Similar to that, the telecom operator was also able to sign a deal with Airtel for an intra circle roaming arrangement. So, if you’re not able to connect to Aircel network to receive calls, SMS or to generate MNP port out code, then manually select Airtel 2G network.