Bharti Airtel agreed to pay the Tanzanian government TZS60 billion ($26.1 million) and write-off a $407 million debt as part of a package of measures to resolve a bitter ownership dispute, Bloomberg reported.
The cash payment to the government will be made in monthly installments spread over five years, the company said at a press conference in Tanzania. Airtel added it would pay a “special dividend” of an undisclosed sum to authorities later this year.
Other measures to settle the row include a $1 million donation to development projects in the country and the appointment of Tanzanian nationals to the local operation’s board.
Airtel previously agreed to sell a 9 per cent stake in the unit [1] to the government, adding to its existing minority share. Following the move, the operator’s majority share reduced to 51 per cent.
The latest concessions apparently end a long-running dispute over ownership of the unit, which flared-up when authorities threatened to take the whole operation into government ownership [2] at the start of 2018.
Airtel and Tanzania have been sporadically at loggerheads since, with the country raising objections [3] when news emerged of plans for an IPO of Airtel Africa [4].
Throughout the row Airtel maintained its ownership of a majority stake was completely legal. Tanzania’s claim on the asset was the result of issues predating the company’s purchase of the operation, it argued.
[1] https://www.mobileworldlive.com/featured-content/top-three/bharti-airtel-offloads-tanzania-unit-stake/[2] https://www.mobileworldlive.com/featured-content/top-three/tanzania-stakes-claim-for-airtel-unit-after-illegal-sale/
[3] https://www.mobileworldlive.com/featured-content/top-three/airtel-africa-ipo-facing-opposition/
[4] https://www.mobileworldlive.com/featured-content/top-three/airtel-presses-on-with-africa-ipo-plan/
