Bharti Airtel Allocates 14.16 Lakh Equity Shares To Some FCCB Holders

Foreign Currency Convertible Bond (FCCB) holders will receive 14.16 lakh fully paid-up equity shares from Bharti Airtel, the company announced on Friday. 

The conversion price of Rs 518 per equity share has been approved by the committee of directors. The decision is the result of the holders of FCCBs having sent notices for the conversion of their securities, which have a principal value of USD 10,188,000.

Bharti Airtel said in a regulatory filing with the Bombay Stock Exchange (BSE) that the special committee of directors for fund raising has approved the allotment of 1,416,607 fully paid-up equity shares of face value Rs 5 each at a conversion price of USD 10,188,000, upon receipt of notice for conversion of FCCBs of principal value of USD 10,188,000 from certain FCCB holders.

FCCB is essentially a quasi-debt instrument that gives the bondholder an option to convert to stock and acts like a bond by paying principal and coupons on a regular basis.

This relates to the USD 1,000 million, 1.50 per cent convertible bonds due in 2025 that the company issued via a circular dated 14 January, 2020. 

The filing states that the FCCB holders may convert the bonds into fully paid up equity shares of the company at a rate of Rs 5 per share at any time on or after 27 February, 2020, and up until the close of business hours on 7 February, 2025.

The acceptance of share allotment by the special committee has resulted in an increase in the company's paid-up equity share capital. Additionally, the FCCBs' outstanding principal value has now been reduced to USD 577.506 million, as informed by the company, as listed on the Singapore Exchange.