A Group of Ministers (GoM) has reportedly deferred merger of Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL), citing financial reasons. Further, the GoM is also believed to have approved the sale of 6,000 square metres of BSNL land in Noida to Central Board of Secondary Education at the rate of over Rs 100,000 per square metre.
Earlier, the Cabinet had approved revival package worth Rs 690 billion for BSNL and MTNL, which included approval to merge both the companies.
The GoM has also approved the allocation of 4G spectrum to BSNL in Delhi and Mumbai in place of MTNL. Recently, the Department of Telecommunications (DoT) gave the licence to BSNL to operate in Mumbai and Delhi telecom circle where MTNL is already operating.
As far as asset monetisation of the two telcos is concerned, the GoM is expected to take a call on asset sale with a value of more than Rs 100 million but less than Rs 1 billion.
As per the audited financial results for the year ending March 31, 2020, the total liabilities of BSNL and MTNL stood at Rs 876.18 billion and Rs 302.42 billion, respectively. In addition, there are issues around difference in salary structure between BSNL and MTNL employees and bringing them in sync is a challenge.
