The Department of Telecom (DoT) has approved raising of foreign direct investment in Bharti Airtel to 100 percent from 49 percent allowed earlier, a stock exchange filing of the company said on Tuesday.
Bharti Airtel receives approval from the Department of Telecommunications for increasing the limit of foreign investment up to 100% of the paid-up capital of the Company pic.twitter.com/p88y3g7ImY
" CNBC-TV18 (@CNBCTV18Live) January 21, 2020
The company also has the approval of the Reserve Bank of India (RBI) that allowed foreign investors to hold up to 74 percent stake in the company.
"Bharti Airtel Limited has received the approval from the Department of Telecommunications (DoT) vide its letter dated January 20, 2020, for increasing the limit of foreign investment up to 100 percent of the paid-up capital of the company," the filing said.
The approval comes few days before the company has to clear statutory liabilities of up to nearly Rs 35,586 crore, of which Rs 21,682 crore is licence fee and another Rs 13,904.01 crore is spectrum dues (excluding the dues of Telenor and Tata Teleservices), a PTI report said.
"...the aforesaid approval read together with the RBI approval dated July 3, 2014 granted to the company allows the FPIs/FIIs to invest upto 74 percent of the paid-up capital of the company," it said.
Earlier, in December, Bharti Telecom, a promoter of Bharti Airtel, had sought government nod for the infusion of Rs 4,900 crore investment from Singapore-based Singtel and other foreign entities, a move that would make the country's oldest private telecom operator a foreign entity.
The fund infusion will enhance foreign stakeholding in Bharti Telecom to over 50 percent that will make it a foreign-owned entity, an official source aware of the development told PTI. Sunil Bharti Mittal and his family own around 52 percent stake in Bharti Telecom, at present.
Bharti Telecom holds around 41 percent stake in Bharti Airtel while foreign promoter entities hold 21.46 percent stake in the telecom firm. Public shareholders have around 37 percent stake in the company.
The total foreign shareholding is 43 percent in Bharti Airtel, at present. With promoter firm Bharti Telecom becoming a foreign entity, foreign shareholding in the company will cross 84 percent, the source said. Bharti Airtel was in discussion with Singtel and other entities for fund infusion.
The company in August had informed stock exchanges that Bharti Telecom in order to retire some debt may seek equity from its existing promoter group which may include overseas entity and Singtel in proportionate to its holding.
Bharti Airtel has said that even a marginal increase in foreign equity would take the foreign investment in Bharti Telecom above 50 percent making it a foreign-owned entity.
Bharti Airtel had already applied to raise FDI limit to 100 percent in the company.
--With PTI inputs