According to a regulatory filing, Bharti Airtel Services, a wholly-owned subsidiary of Bharti Airtel, has entered into an agreement for the acquisition of 4.94 million equity shares representing 97.1 per cent stake in Beetel Teletech Limited, another Bharti Group company. Consequently, Beetel will become a subsidiary of the company. The cost of the acquisition is pegged at Rs 6.69 billion in the form of a cash transaction.
As per the filing, the acquisition is a part of the company’s strategy to enable indigenisation initiatives within its own ecosystem of telecom products in line with the government’s Make in India policy and add distribution and service capabilities (including system integration) largely for the enterprise business. Beetel also has a 49 per cent stake in a joint venture having two manufacturing facilities which produce telecom and networking products including those qualifying for the production linked incentive (PLI) scheme.
The acquisition is a related party transaction in terms of the provisions of Securities and Exchange Board of India (SEBI) listing regulations. Bharti Group companies namely Bharti Enterprises (Holding) Private Limited, Bharti (RM) Holdings Private Limited, Bharti (RBM) Holdings Private Limited and Bharti (LM) Enterprises Private Limited hold a 97.1 per cent stake in Beetel.
