Bharti Airtel spurts on strategic stake sale to Qatar Foundation

NEW DELHI: Bharti Airtel Ltd rallied over 4 per cent in a weak market on Friday after the country's leading telecom operator entered into an agreement to sell 5 per cent stake to Qatar Foundation Endowment (QFE) for $1.26 billion (Rs 6796 crores).

At 09:25 am, Bharti Airtel pared some of its morning gains and was trading 2.9 per cent higher at Rs 325.95. It hit a low of Rs 326.20 and a high of Rs 326.20 in trade today.

Under the agreement Bharti Airtel will issue 199,870,006 of its new shares to QFE representing a shareholding of 5 per cent in the Company at a price of Rs 340 per share.

The investment will further strengthen the capital structure and provide further flexibility for the company to deliver on its growth strategy, it said.

“This strategic partnership with QFE demonstrates the confidence they have in the company and our strategy for growth,” Sunil Bharti Mittal, Chairman, Bharti said in a filing with the Bombay Stock Exchange.

“In addition, this agreement exemplifies further strengthening of the already deep economic and cultural relations between Qatar and India. We look forward to a long and fruitful partnership with QFE,” he added.

On Thursday, Bharti Airtel reported earnings for the quarter ended March 2013. The telecom major’s net profit fell for the 13th straight quarter as it missed Street estimates to clock a 50 per cent decline weighed down by Africa operations.

The company’s net profit fell to Rs.508.6 crore from Rs.1,005.9 crore in the year-ago period, a decline of 49.43 per cent, due to tax charge and higher net interest costs.