India’s Bharti Airtel with revenue of $ 14.49 billion in 2012, has acquired additional 13.36 percent stake in its Nigerian entity, through its wholly owned subsidiary, Airtel Nigeria, amid legal battles many analysts argue constitute a huge threat to the viability of the business.
These stakes has been acquired from “certain existing shareholders”, the company said in a communication to stakeholders. The financial details of this acquisition however have not been mentioned.
With the latest deal, according to a report, the subsidiary Bharti Airtel Nigeria now owns around 79 percent stake in Airtel Networks, Nigeria. This would consolidate Airtel’s position over its Nigerian assets.
Bharti Airtel acquired Kuwaiti telecom company’s Zain’s African assets in 2010 for $10.7 billion. The telecoms company’s African assets are spread across various countries of the continent. But Airtel’s ownership of the Nigerian entity has been entangled in legal battles. Econet Wireless, a 5 percent stakeholder in the entity had filed court cases as well as sought $3.1 billion in damages after opposing sale of the Nigerian business.
It would be recalled that a Nigerian court on January 30 had declared Bharti Airtel’s ownership of its subsidiary, Airtel Nigeria, “null and void” because co-founder and 5 percent shareholder, Econet, was not consulted on the transfer.
But Bharti Airtel, last month said its stake in its Nigerian unit was “completely safe” and that the world’s fifth-biggest mobile phone carrier with about 243.336 million subscribers globally had appealed against the verdict. The battle for the ownership of the Nigerian outfit however took a new dimension after the Court of Appeal, Lagos Division fixed April 8, 2013 for hearing of an appeal filed by Celtel Nigeria Limited against an award made by an international commercial arbitration tribunal in favour of Econet Wireless. Besides, the appeal followed the judgment of a Lagos High Court which dismissed its application to set aside the verdict of international tribunal.
The International tribunal comprising senior Nigerian and English lawyers, had found multiple breaches of shareholders’ agreement by both the selling shareholders and Celtel Nigeria and ordered them to pay a yet to be determined damages/equitable compensation to Econet.
BEN UZOR JR
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