Aircel Founder: Politics made me undersell despite AT&T's $8 bn offer

Aircel, once a telecom giant in India founded by Chinnakannan Sivasankaran, was known for its innovative services. 

However, it faced fierce competition and regulatory challenges. 

In a recent podcast episode of "Figuring Out" with Raj Shamani, Sivasankaran shared his experiences from a decade ago during the UPA era, contrasting them with today's business landscape under the Modi regime.

A Decade of Pressure and Missed Opportunities:

Aircel Founder C Sivasankaran recounted how growing businesses a decade ago faced intense pressures. 

"If your business started growing, you were pressured to 'sell to a particular person'," he revealed. 

When asked about the sale of Aircel, he said, "I just made a partly sum of Rs 3400 crores. If I had sold it to AT&T, I would have got 8 billion." He explained he couldn't sell to others because of the coercive environment at the time. "Today, no one can pressurise you," he added, highlighting the more liberalised business environment now.

Aircel's Financial Troubles and Bankruptcy:

Aircel, founded in 1999 by Sivasankaran, initially saw success, particularly in Tamil Nadu. 

Maxis Communications acquired a 74% stake in Aircel, but the entry of Jio in 2016-17 led to significant losses for Aircel, causing a decline in market share. Aircel filed for bankruptcy in 2018 and owed around Rs 12,389 crore to the Department of Telecommunications. Despite attempts to sell assets, Aircel went into liquidation.

The company's departure marked the end of an era in India's telecom sector.

Aircel faced multiple challenges, including a failed restructuring program, funding cuts from Maxis, disrupted services, unsuccessful 4G spectrum sharing, and mounting debt of Rs 15,000 crore, leading to its bankruptcy application in March 2018.