Earlier this year, Bharti Airtel, the country’s second largest telecom operator, announced it was receiving a $1 billion investment from Google. Of the $1 billion, over $700 million was an investment in the telecom company for a 1.28% stake. The remaining $300 million was earmarked for completing multi-year agreements. The primary purpose of Google’s investment in Airtel was to help shape India-specific 5G use cases. Telekom shareholders had approved the deal between the companies. However, a final decision by the Indian Competition Commission (CCI) was still pending.
On June 30, 2022, Airtel announced that it has received the green light from CCI for Google’s US$700 million (Rs. 52,243.80 million) investment. Airtel will issue Google up to 71,176,839 shares with a par value of Rs. 5 each at a price of Rs. 734 per share.
This means that Google will now own 1.28% of Bharti Airtel.
No conflict of interest, although Google has also partnered with Jio
Google also works closely with Reliance Jio, India’s leading telecom operator and Bharti Airtel’s main competitor.
Gopal Vittal, CEO of Bharti Airtel, previously said there would be no conflict of interest in the telecom company’s deal with Google. Vittal had made it clear that the deal between Airtel and Google is different from that between Google and Jio.
Google and Airtel are planning several commercial deals in the future that differ from what Jio is planning with the search engine giant. This is a big win for Bharti Airtel.
That money, along with the thousands of crores Airtel will save by announcing it will defer additional AGR (Adjusted Gross Revenue) fees up to FY 2018-19 for four years, will put Airtel in a very strong position to compete against Jio .
The war for attracting customers in the 5G era will start again and this time Jio will have Airtel as an equal competitor.
( Image : Twitter )
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