Russian conglomerate Sistema's Indian unit on Monday won telecom spectrum in eight circles or zones for Rs 3,639 crore (Rs 36.39 billion) in an auction shunned by all other companies.
Sistema Shyam TeleServices Ltd (SSTL) bid to recover airwaves it lost when the Supreme Court last year scrapped 122 wireless mobile permits amid graft charges.
Telecom Secretary R Chandrashekhar said the auction ended in just three rounds with lone bidder SSTL putting in bids at the minimum bid price, which had already been cut by about half after no companies bid for the band in November.
In all 24 blocks in eight telecom circles or zones were allocated out of 61 blocks that were put for auction. "In other words, 40 per cent of the spectrum that was put for auction has been won," he said.
"In value terms, the value of the spectrum which has been won is around Rs 3,639 crore, which represents little over 56 per cent of the value of
The government may not get any upfront payment as Rs 1,626 crore (Rs 16.26 billion) has to be adjusted against the license fee SSTL had paid in 2008. The licences cancelled by apex court included 21 of SSTL.
The auction results may dampen Finance Minister P Chidambaram's efforts to garner a reduced Rs 19,400 crore (Rs 194 billion) from spectrum sale this fiscal. He had previously targeted Rs 40,000 crore (Rs 400 billion) from spectrum auction to cut budget deficit.
None of the 12 telecom operators in the world's second-largest mobile phone market including Anil Ambani's Reliance Communications and Tata Teleservices participated in the auction as most of them considered the reserve or auction start price set by the government as too high.
Last spectrum auction in November drew just five bidders but none for the 800 MHz spectrum that Sistema sought on Monday, and netted the government Rs 9,407 crore (Rs 94.07 billion) as against the government's expectations of Rs 27,000 crore (Rs 270 billion).