In a move to pare its debt, telecom giant Bharti Airtel on Tuesday sold 83 million shares in its mobile tower subsidiary, Bharti Infratel, for over Rs 3,325 crore. Explaining the move, Bharti Airtel said it would primarily use the sales proceeds to pay its long pending debt. The deal will be completed through stock market, according to the company statement.
“The buyers of the proposed sale included global investors, fund managers and long-only funds, including many repeat investors,” it said, adding that the deal was upsized by over 25 per cent given healthy investor appetite.
“The secondary share sale was executed at Rs 400.6 per share, representing 3.6 per cent discount to the previous day’s closing price,” Airtel added.
The consolidated debt of the Sunil Mittal-owned company was Rs 91,480 crore as on September 2017.
like other incumbent operators, the country's largest telecom company has been locked in a fierce tariff war with newcomer Reliance Jio in the mobile telephony market.
After Tuesday’s share sale, the stake of Bharti Airtel and its wholly-owned subsidiaries in Bharti Infratel would come down to 53.51 per cent.
According to BSE data, the promoters' holding in the tower infrastructure company stood at 58 per cent as on September 2017. The sale was carried out by Airtel via its wholly-owned subsidiary, Nettle Infrastructure Investments.
Announcing the “successful divestment” of 83 million shares in Bharti Infratel, the company said: “The sale was for a total consideration of over Rs 3,325 crore ($510 million) and was executed at a price of Rs 400.6 per share, representing a discount of 3.6 per cent to the previous day’s closing price.”
JP Morgan, UBS and Goldman Sachs were joint placement agents for the transaction. Telecom tower companies have been grabbing the headlines over the last few weeks.
Vodafone India and Idea Cellular, which are headed for a merger, said on Monday that they have separately decided to sell their tower businesses in India to ATC Telecom Infrastructure for Rs 7,850 crore.
late last month, Bharti Airtel said that a few “reputed” global investors had approached it for buying a controlling stake in Bharti Infratel.