Airtel holding company to raise USD1bn through share sale

26 May 2020

Bharti Telecom, a holding company of Indian telecoms group Bharti Airtel, is set to sell a 2.75% stake in the operator to raise around USD1 billion today with the intention of clearing its debts, the Economic Times writes. A person familiar with matter was quoted by the paper as saying that ‘Bharti Telecom intends to clean up debt at the promoter level, which will clear the path for it to inject more capital towards shareholder support at Airtel in the near future’. The stake sale will help make the holding company debt-free and reduce Bharti Airtel’s so-called ‘debt overhand’, as the ratings agencies and other bodies include the financial obligations of promoter groups in assessing a company’s financial strength. Bharti Telecom currently holds a 38.79% stake in Airtel (as at end-March 2020), and the sale will reduce the combined stake in Airtel held by Telecom’s co-owners Singtel and Bharti Enterprises to around 31.9% and 24.3%, respectively – both promoter groups hold additional shares through other intermediaries.

India, Bharti Airtel, Singtel, Singtel Group