BSNL and MTNL's asset sale in progress: Report

The process of monetising landholdings of Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) by Central government has begun.

Consultancy firms - CBRE, JLL, and Knight Frank has been appointed by the Department of Investment and Public Asset Management (DIPAM) to look at the feasibility of such a sale during the pandemic.

The consultants will submit their reports by end of the month.

At a meeting in Prime Minister’s Office (PMO) last week, both BSNL and MTNL’s asset monetisation has been estimated to fetch around Rs 37,500 crore.  

The telecom department has now been told to fast track the process, according to an official in the know.

The consultants would look at the valuation of the assets, along with the current market appetite, while preparing their reports.

This asset monetisation of BSNL and MTNL will help the government to offer relief packages to the financially stressed state telcos.

In October 2019, the government approved a revival package of nearly Rs 70,000 crore for BSNL and MTNL.

Monetising real estate assets is part of the overall relief package that would be used to retire debts, upgrade networks, and offer a voluntary retirement scheme (VRS) aimed at reducing the telcos’ employee strength by half.

The real estate assets primarily include land as well as rental and leasing of buildings. MTNL has around 29 retail outlets in Delhi alone.

The relief package includes a sovereign bond issue worth Rs 15,000 crore, to be serviced by these PSUs.

Officials said the asset sale would be an important exercise for payment of VRS compensation to the staff of BSNL and MTNL.

Asset sale is not a one-time exercise and will be spread over a couple of years.