India’s largest telecom service provider Bharti Airtel on Friday announced to sell its 5% equity to Doha-based Qatar Foundation Endowment (QFE) for around Rs. 6,800 crore ($1.26 billion) by issuing about 199.87 million new shares.
The equity infusion comes at a time when the company reported decline in profit for thirteenth consecutive quarter. Moreover, the company has to pay a significant amount as spectrum fee when its licences come up for renewable next year. The company may also be required to pay penalty on account of alleged illegal roaming agreements for 3G services.
“It has entered into a binding agreement with Qatar Foundation Endowment (QFE), under which Bharti will issue 199,870,006 of its new shares to QFE representing a shareholding of 5% in the vompany, post issuance of the new shares,” the company said in a statement.
Under this agreement, QFE will subscribe to 199,870,006 new shares of Bharti at a price of Rs. 340 per share.
“This agreement exemplifies further strengthening of the already deep economic and cultural relations between Qatar and India,” said Sunil Mittal, chairman, Bharti Airtel, said in the statement.
“As a long-term global investor, our shareholding gives us exposure to a high growth sector in key emerging markets. QFE looks forward to supporting Bharti in realising the full potential of this world class business,” said Rashid Al-Naimi, acting chief executive officer, QFE.