Bharti Airtel Agrees to Cede Some Shareholding in Tanzanian Unit

DAR ES SALAAM (Capital Markets in Africa) – Bharti Airtel Ltd. has agreed to reduce its stake in its Tanzanian unit to 51 percent from 60 percent after months of negotiations with the government, which accused the operator of acquiring the initial shareholding illegally.

The Tanzanian government’s stake will increase to 49 percent from 40 percent, Chairman Sunil Bharti Mittal said in comments emailed by President John Magufuli’s office.

Airtel has said its acquisition in 2010 of the 60 percent stake from Kuwait’s Mobile Telecommunications Co., known as Zain, was in full compliance and received all necessary approvals from the government. Tanzania’s complaint relates to the initial privatization of the company five years prior to when Airtel took control, it said in a statement at the time.

“The president has taken upon himself to ensure a very clean environment in this country and in that process he wanted to go through all the issues of this company from the past and his teams have been very diligent in walking us through the issues,” Mittal said. “Such negotiations do take some time and we are glad that we have come to a point that we will be making some final decisions.”

Unpaid Dividends
Airtel has also agreed to settle unpaid dividends from the past eight to 10 years, the president said in an emailed statement.

“The percentage of dividends will be discussed today,” Magufuli said. “This is a good light for us and Bharti Airtel, and other companies, going forward.”

Nicknamed “the bulldozer,” Magufuli has been seeking to secure more revenue for his country and has gotten into disputes with companies such as Acacia Mining Plc, which he’s accused of underdeclaring gold shipments. While also pushing to rid the nation of corruption and inefficiency, the leader has been vilified for being too high-handed and for undermining civil and human rights.

Source: Bloomberg Business News