Earlier, Bharti Airtel had announced that it is looking for a strategic investor via allotment of preferential equity shares. The approval of which has to be decided by the board on January 28.
Today, Bharti Airtel unveiled the name of that potential investor. It is none other than Google that partnered with Jio last year.
This year, Google collaborated with Bharti Airtel. The telecom company’s board has also approved the issuance of 7.1 crore equity shares to Google on a preferential basis.
” … the Board of Directors (‘Board’) of the Company, at its meeting held today i.e. January 28, 2022, approved the issuance of up to 71,176,839 equity shares of the face value of Rs 5- each of the Company to Google International LLC on a preferential basis in accordance with Chapter V of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 (‘ICDR Regulations’), as amended and other applicable laws, at a price of Rs 734- per equity share aggregating to Rs 52,243.80 million, subject to the approval of regulatory/ statutory authorities and the shareholders of the Company at the Extraordinary General Meeting,” the filing said.
India’s second-largest telecommunications company has entered a long-term, multi-year agreement with Google to accelerate the country’s digital ecosystem.
As a part of the deal, Google would spend up to $1 billion as part of its Google for India Digitization Fund, which will comprise both equity and a corpus for prospective commercial deals that will be approved on mutually agreeable terms over the next five years.
Bharti Airtel stated in a regulatory filing that Google will infuse $700 million for the acquisition of 1.28 percent ownership in the telecom company and up to $300 million towards prospective multi-year commercial agreements.
It also stated that acquisition is subject to the required regulatory approvals.
Under their first commercial agreement, Airtel and Google will focus on scaling up Airtel’s extensive offerings, covering a range of Android-enabled devices, to consumers via innovative affordability programs.
Both the companies will explore opportunities to tear down the tech divide and enable every individual with a smartphone across a range of price points by collaborating with various device manufacturers.
The investment “is a continuation of our Google for India Digitization Fund’s efforts to increase access to smartphones, enhance connectivity to support new business models, and help companies on their digital transformation journey,” Sundar Pichai, chief executive officer of Google and Alphabet said in a statement.
Google and Airtel will leverage their partnership to potentially co-create India-specific network domain use cases for 5G and other standards and speed up the cloud ecosystem for businesses across the country.
“Airtel and Google share the vision to grow India’s digital dividend through innovative products. With our future-ready network, digital platforms, last-mile distribution and payments ecosystem, we look forward to working closely with Google to increase the depth and breadth of India’s digital ecosystem,” Sunil Bharti Mittal, Chairman of Bharti Airtel said.
The shares of Bharti Airtel closed 1.21% or Rs 8.55 higher at Rs 715.18.