Bharti Airtel, the subsidiary of Singapore Telecommunications (Singtel), has announced on Jan 4 that it will withdraw the scheme of arrangement for a new corporate structure it had announced in April last year.
This follows the telecom sector reforms package announced by the Indian government in September, which Bharti says has “significantly boosted the outlook and investor confidence for the industry while simplifying the license framework”.
“With a strong balance sheet and 5G ready network, Bharti Airtel is well positioned to invest aggressively in the emerging growth opportunities offered by India’s digital economy. The board of directors of Bhart Airtel is of the view that the existing corporate structure of the company is, therefore, optimal for leveraging these emerging opportunities and unlocking value while continuing to scale up Airtel’s digital businesses,” the company’s statement reads.
Under the previously announced structure, Bharti Airtel had proposed to fold Airtel Digital into the Bharti Airtel listed entity, which would house all its digital assets including Wynk Music, Airtel X stream, Airtel Thanks, Mitra Payments platform, Airtel Ads as well as other existing and future digital products and services. Meanwhile, all of Bharti Airtel’s telecommunications business would go under a newly created entity, Airtel Limited.
Under a modified scheme, the group will now only consolidate its fiber assets into the listed entity, through the merger of wholly-owned subsidiary Telesonic Networks into Bharti Airtel. In addition, Nettle Infrastructure Investments will also be merged with Bharti Airtel.
The group also says it will pursue its plan to eventually fold the direct-to-home (DTH) business, Bharti Telemedia, into Bharti Airtel to move towards the national digital communications policy (NDCP_ vision of converged services to customers.
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The group’s businesses will continue to be categorised under four key verticals - India, Digital, International and Infrastructure.
As at 10.02am, Singtel shares are down 1 cent or 0.43% lower at $2.33.
