(Bloomberg) -- Billionaire T. Ananda Krishnan's Aircel Ltd. has asked an Indian court to initiate bankruptcy proceedings as it's unable to repay about 500 billion rupees ($7.7 billion) of dues.
The mobile carrier owes about 150 billion rupees to secured financial creditors and the rest to operational unsecured creditors, including those who provided it goods and services, Janak Dwarkadas, a lawyer representing Aircel, told the Mumbai bench of National Company Law Tribunal on Monday. In addition, the company also has an unpaid interest amount totaling 5.79 billion rupees, he said. The court will hear the petition on March 8.
The unit of Krishnan's Maxis Communications Bhd. will be placed under an insolvency resolution professional, who will have as long as 270 days to work out a repayment plan, if the court agrees. If no plan is agreed on by the deadline, the company will be thrown into liquidation to repay dues. Aircel is the latest casualty as a bruising tariff war, escalated by the entry of richest Indian's Reliance Jio Infocomm Ltd. in 2016, rages on and the bank regulator chases down delinquent borrowers.
โThere's a sense of urgency here,โ Dwarkadas told the court. Almost 6,000 employees at the company have not been paid their February salaries, he said.
Aircel Chief Executive Officer Kaizad Heerjee didn't immediately respond to a text message and a phone call seeking comment.
Read more: QuickTake explainer on India's bankruptcy law
Companies backed by Krishnan stand to lose almost $7 billion it poured into Aircel over the past 12 years, people with knowledge of the matter said, after the carrier filed to start bankruptcy proceedings.
Aircel submitted its request on Feb. 28, the first major company in the country to make such a move on its own as on previous occasions banks initiated bankruptcy proceedings. At least three companies including Bhushan Steel Ltd., Lanco Infratech Ltd. and Essar Steel Ltd. have entered bankruptcy proceedings with claims of more than 500 billion rupees, according to the government's Economic Survey 2017-18.
--With assistance from P R Sanjai
To contact the reporter on this story: Bhuma Shrivastava in Mumbai at bshrivastav1@bloomberg.net.
To contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Subramaniam Sharma, Arijit Ghosh
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