Bharti Airtel has acquired a 9 per cent stake in renewable energy firm Avaada Clean TN Project, a special purpose vehicle founded for the aim of owning and operating captive power plants, for about Rs 78.8 million in an all-cash deal. Bharti Airtel’s stock rose 2 per cent in early deals on March 10, 2022 after the telecom major announced the acquisition.
Bharti Airtel acquired Avaada to meet regulatory requirements for captive power plants under the Electricity Act 2003 and Indian Electricity Rules 2005, as well as to obtain cost-effective renewable energy. Earlier, Bharti Airtel shareholders had already authorised the issue of preferred shares to Google in exchange for its Rs 75 billion investment in the firm, which would provide it a 1.28 per cent stake. According to the voting results of an extraordinary general meeting, a special resolution to authorise Google’s investment was adopted by nearly 99 per cent of the shareholders.
Additionally, Bharti Airtel’s recent Rs 25 billion investment in Indus Tower is subject to the requirement that the money paid to Vodafone Plc be reinvested in VIL as new equity. This amount will then be utilised by VIL to pay off its outstanding debts to Indus. Indus, on the other hand, should put the funds towards paying annual dividends.