Singtel's Indian unit divests 2.75% stake for $1.63b

Bharti Group and Singtel will continue to own 56.23% in Bharti Airtel.

Singtel’s Indian associate Bharti Airtel have sold 2.75% of its stake to institutional investors for $1.63b (US$1.15b) through an accelerated book building process in the secondary market, an SGX filing revealed.

The allocation was done to over 50 accounts, with the top 10 getting two-thirds of the overall allocation. The total sale proceeds were oversubscribed multiple times, with long-only and hedge fund investors across India, Asia, Europe and the US.

The stake sale was anchored by several existing and new shareholders and several marquee global mutual fund complexes, sovereign wealth funds, multi-strategy funds and domestic institutional investors in sizeable quantities.

Bharti Group and Singtel will continue to own a majority stake in Bharti Airtel at 56.23%.

“With the proceeds, Bharti Telecom Limited will become a zero debt company providing an even stronger financial flexibility and capacity to provide any additional shareholder support as may be desired by Bharti Airtel from time to time,” said Harjeet Kohli, group director at Bharti Enterprises.

Specifically, the proceeds will be utilised to fully repay debt at Bharti Telecom Limited to finance the acquisition of Bharti Airtel equity shares in the past. With Bharti Telecom Limited becoming a zero debt company, Bharti Airtel’s credit profile will also be augmented as it will stand to benefit from deleveraging on a consolidated basis ,including any debt of the promoter holding company.

J.P. Morgan India Private Limited acted as the sole placement agent for the secondary placement.