As the January 23 deadline for payment to the Department of Telecom (DoT) approaches, Bharti Airtel on Wednesday launched a $2 billion Qualified Institutional Placement (QIP) at an indicative issue floor price of Rs 435 per share and the foreign currency convertible bonds (FCCBs) to raise another up to $1 billion.
Bharti Airtel's QIP indicative price is at 5.2 per cent discount to the current market price.
The telco, which has to clear Rs 35,586 crore dues to the DoT by January 23, will use a part of the proceeds to meet this liability. "The company proposes to use the net proceeds for any payments that may be required to be made, arising out of the October 24 Supreme Court judgment in relation to a long outstanding case in respect of the definition of adjusted gross revenue (AGR)," Airtel said.
The Supreme Court upheld the government definition of revenue, which included revenue from non-core telecom operations like rent, dividend and interest income. Licencees have been asked to pay 8 per cent of their AGR as licence fee to the DoT.
The verdict settled the 14-year dispute between operators and the DoT.
Bharti Airtel also plans to use the QIP proceeds to augment long-term resources and strengthen balance sheet, for servicing and/or repayment of short- and long-term debts, capital expenditures, long-term working capital needs.
The FCCB issue proceeds will be used for capital expenditure, repayment of existing indebtedness, and/or any other use, each as permitted under applicable laws and regulations from time to time.