Airtel Africa Renews Existing Service Agreements With BAL, BAIN

Airtel Africa plc has announced that it has further renewed the existing services agreements in place with Bharti Airtel Limited (BAL) and its wholly owned subsidiary Bharti Airtel International (Netherlands) B.V (BAIN).

This was contained in the company’s notice to the Nigerian Exchange Limited, signed by Simon O’Hara, Group company secretary.

The firm explained that the renewal was under which, BAL (itself or through its affiliates) provides certain services to the Company (and its subsidiaries) relating to finance, operations, and corporate head office functions.

The company noted that the existing services agreements and the arrangements under them were described in the Company’s prospectus published in connection with its listing in June 2019.

“For Chapter 11 of the Listing Rules, BAL is a related party of the Company by its shareholding in the Company through its wholly-owned indirect subsidiary Airtel Africa Mauritius Limited. Under Listing Rule 11.1.10R, the Transaction constitutes a ‘smaller related party transaction’, and this announcement is made by Listing Rule 11.1.10R(2)(c).

Accordingly, the Company has received confirmation from a sponsor that the terms of the Transaction are fair and reasonable as far as shareholders of the Company are concerned,” the statement said.

The company explained that the consideration paid to BAL under the existing services agreements in the financial year ended 31 March 2023 was $9.9 million.

It added that it is estimated that the total payments to BAL in the current financial year and the next financial year under the renewed existing services agreements will amount to between $19.8 million and $24 million in aggregate over the two years.

It is worthy of note that Airtel Africa plc recorded a foreign exchange loss of $471 million at the end of on June 30, 2023.

This is according to the company’s financial statement filed at the Nigerian exchange.

The unification of the exchange rate by the Central Bank, which pushed the exchange rate from N460/$ in June to N790/$ was the reason for the loss.