According to the Business Daily India’s Bharti Airtel must sell 15 per cent of its stake in Airtel Kenya to a local to avoid getting into trouble with the regulators.
The mandatory share sale is to bring the firm in full compliance with ownership regulations that require telecom companies to maintain at least 20 per cent local shareholding.
The Business Daily further reported that the grace period granted to Airtel will not be renewed meaning the Indian telecoms giant must find a buyer of the 15 per cent stake by April next year.
Speaking to the Business Daily the Indian telecoms operator argued that finding a buyer for the 15 per cent stake worth billions of shillings would be difficult given the fact that the business is yet to make a profit since it was launched three years ago.
The 15 per cent stake is now estimated to be worth KES 5.3 billion based on the USD 63.75 million (now KES 5.2 billion and then KES 4 billion) that Mr Merali earned when he sold the equivalent stake to Zain Group six years ago and would be corporate Kenya’s biggest share transaction in five years if successful.
The Ministry of Information extended by one year, the exemption which would have lapsed in the first quarter of this year, based on the 2009 deal.
Finding a local with Sh5 billion to spend in the transaction will be no mean task for Bharti Airtel, analysts said.