New Delhi, Dec. 5: Bharti Airtel has paid a first-ever interim dividend of Rs 11.75 crore to state-owned TCIL, its minority partner in Bharti Hexacom, paving the way for the resolution of a long-standing difference over the 30 per cent stake held by the public sector unit in the joint venture company.
The government owns 30 per cent in Bharti Hexacom through TCIL, and Bharti Airtel holds the rest.
The government had been looking at various ways to exit the venture since Bharti Airtel had refused to pay dividend despite the unit being profitable for many years. Airtel had maintained that all profits were being ploughed back to expand operations.
Hexacom offers mobile services in six Northeastern states (excluding Assam) and Rajasthan and has a little over 15 million customers.
Bharti Airtel has paid an interim dividend of Rs 11.75 crore to TCIL for 2011-12 at the rate of 15 per cent, TCIL said.
Senior officials of the telecom ministry were also in favour of a dividend to TCIL.
Since Hexacom is a debt-free company, its shareholders should be rewarded with a nominal dividend. We are in talks with Bharti Airtel officials regarding payment of a dividend to the shareholders, a senior ministry official had said.
Bharti Hexacom had earned a net profit of over Rs 700 crore in 2009-10 and is likely to have earned around Rs 650 crore in 2010-11.
TCIL has invested over Rs 106 crore in the venture since 1995, but had not received any returns so far.
The PSU had sought the listing of the joint venture, but the proposal was rejected as TCIL did not have enough voting power on the Bharti Hexacom board. TCIL is represented by two members on the board.
Bharti had resisted listing, saying its flagship company was already listed on the bourses and according to company rules, no subsidiary could be listed on a standalone basis.
Bharti Hexacom was incorporated in 1995 and was promoted by TCIL and Shyam Telecom Ltd Group among others.
The shareholding has changed over time and in 2004, Bharti Airtel acquired 68.5 per cent. Subsequently, it picked up another 1.5 per cent equity from MTC, taking its shareholding to 70 per cent.