Bharti Airtel Board Approves Rs 21,000 Crore Share Sale
By FnF Correspondent | PUBLISHED: 31, Aug 2021, 19:58 pm IST | UPDATED: 08, Sep 2021, 10:05 am IST
New Delhi: In a bid to prepare its war chest ahead of 5G services launch, Bharti Airtel will raise up to Rs 21,000 crore via a sale of shares to existing shareholders. Bharti Airtel Ltd’s board has approved the proposal of selling stocks to existing shareholders as the telecom operator seeks to expand its network amid intense competition.
The shares would be priced at Rs535 apiece, which is around a 10 per cent discount to Friday's close of Rs595.15, as per the news agency Reuters. Bharti founder-chairman Sunil Mittal and others in the founder group will also participate in the share sale whereas shareholders would be eligible to buy one share for every 14 shares they hold in the telecom firm, as per the company statement.
Ambani managed to gain a huge market share and forcing several rivals out of the market while others such as the local unit of Britain's Vodafone and India's Idea merged to withstand Jio's onslaught. Reliance Communications also attracted investments from Facebook, Qualcomm, and Intel for Jio Platforms digital unit.
Jio has developed its own 5G solution and Ambani said the telecom firm will be the first to launch 5G services in India. The fundraising will mostly aid to strengthen its balance sheet, invest in building a fifth-generation, or 5G, telecom network, strengthen its existing network to compete with Reliance Jio. Besides, it will also help in paying adjusted gross revenue-related (AGR) liabilities, among other dues, as per the Hindustan Times report. However, the company did not specify how it will use the proceeds of the share sale.
The board also reviewed the industry scenario, business environment, and the financial and business strategy of the company.
Last time, Bharti Airtel Rs 25,000 crore through a rights offering in May 2019. In February 2021, it raised $1.25 billion by selling debt instruments to overseas investors ahead of a planned spectrum auction in March. Earlier this month, it raised Rs 1,005 crore by transferring its ‘right to use’ of 800MHz spectrum in three circles to Reliance Jio, which also assumed future liabilities of Rs469.3 crore related to the spectrum.