Categories Bharti Airtel

Bharti Telecom to Acquire 4.62% Stake in Airtel

Published by
Chakri K

Bharti Telecom Limited, the holding company of Bharti Airtel Limited, is set to acquire as much as 4.62% in India’s largest telecom operator, the company told the National Stock Exchange on Monday. Bharti Telecom said that the price of the acquisition will not be higher by more than 25% of the price computed in point 6 (which is Rs. 417.35 a unit).

Airtel 4G

Bharti Telecom will acquire 184,710,183 equity shares of Bharti Airtel from another promoter firm of the telecom major, Indian Continent Investment Limited (ICIL) at the price of R. 417.35 per share, derived with weighted average market price in a trading period of 60 days, as per the filing. At this price, the size of the transaction between Bharti Telecom and ICIL is likely to be between Rs. 7,700 crore and Rs. 9,623 crore.

 

With this transaction, Bharti Telecom stake in the company will rise to 50.1% in Bharti Airtel from its previous 45.48% and ICIL stake will come down to 2.03%. As many as 184.71 million shares owned by Indian Continent Investment Limited (ICIL) will be acquired on or after November 3, the company said. ICIL will continue to hold 2.03% stake in Bharti Airtel after the proposed transaction.

In reaction to the news, the shares of Airtel climbed 1.59% to Rs. 492.80 while the benchmark Sensex gained 0.33% to 33,266.16 points.

The Mittal family own 51% of stake in Bharti Telecom and by virtue of that, own around 30% stake in Airtel. With the proposed deal, the total shareholding of the family is set to rise. With the deal, Bharti Telecommunications will still remain the second largest shareholder in the Indian company after Singapore Telecommunications Ltd (Singtel), which is the largest shareholder in Airtel with a 36.27% stake.

The recent onslaught by Reliance Jio Infocomm Ltd has increased the competitive intensity and has forced the rival operators to raise capital expenditure. Bharti Airtel’s share price has gained more than 60% in a year, outperforming that of the BSE Sensex, which gained 41% with a promise of even better times to come.

Chakri K

Chakri is a go-to guy for your next smartphone recommendation. Back in his engineering days, he used to play with smartphones by installing custom ROMs and that passion got him into the tech industry. He still goes nuts about a smartphone knocking his door for review. Currently managing everything at Telecom Talk, Chakri is trying to master PUBG Mobile in his free time.

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Published by
Chakri K

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