In a setback to Bharti Airtel, the nation's largest mobile-phone operator has lost a court case in Nigeria and potentially faces USD 3 billion in payouts over a 5 per cent stake claimed by Econet Wireless in its Nigerian unit.
Bharti said it will appeal in Nigeria's Supreme Court against the judgement of the court, which held that Econet Wireless remained a bona fide stakeholder in Airtel Nigeria, a unit of the Indian firm.
An Appeal Court in Lagos, in its judgement on February 14, said Airtel failed to get the rulings of two lower courts quashed over attempts by Econet Wireless to reacquire its stake in the company.
"Bharti Airtel, a 79.06% shareholder in Airtel Networks Ltd, Nigeria (Airtel Nigeria) is not satisfied with the judgement of the Court of Appeal, Lagos, delivered on February 14 and will lodge an appeal against that decision at the Supreme Court of Nigeria," Bharti Airtel said in a statement today.
The Indian company said the disputed shares are in an escrow account and the judgement would have no impact on the stake of Bharti Airtel or other Airtel Nigeria shareholders.
No comments were received from Econet.
Airtel Nigeria is part of the African telecom business that Bharti acquired from Zain for about USD 10.7 billion.
"Airtel Nigeria has already launched an appeal before the Supreme Court of Nigeria against the judgement of the Court of Appeal in Kaduna in the matter relating to Econet's claim for 5 per cent shares in Airtel Nigeria," the statement said.
Reacting to the USD 3 billion sought by Econet, Airtel said, "We would like to unequivocally state that neither of these orders of the Courts of Appeals in Lagos and in Kaduna deal with the quantum of damages and no such quantum has been determined."
Nigeria is among Bharti Airtel's top African markets, with a 30 per cent share of revenue from the continent in 2012-13.
"Bharti Airtel and Airtel Nigeria have full confidence in the laws of the land, and believe the Supreme Court in Nigeria will determine the appeals on merits. Airtel wishes to assure its customers, employees and business partners that these judgements will in no way affect operations of Airtel Nigeria," it said in the statement.
The dispute dates to 2003, when Econet says a series of improper decisions taken by Nigerian members of the company resulted in the cancellation of Econet Wireless Ltd's shares in the company, deletion of its name from the register of shareholders and change of name to Vee Mobile Networks.
On 24 January 2012, the Federal High Court of Nigeria ruled that Econet's shareholding in the company must be reinstated, according to the company's website.
It added that the judgement also said the name of the company, now Bharti Airtel Nigeria, should revert to Econet and all decisions in which it was entitled to participate as a shareholder but was prevented from doing so, are null and void. PTI PRS ANZ JC 02202017