Bharti Airtel up 15% as investors to pump $1.25 billion in African unit

The stock moved higher by 15% to Rs 329 after Bharti Airtel said that six leading global investors to invest $ 1.25 billion in Airtel Africa through primary equity issuance.

Shares of Bharti Airtel have moved higher by 15% to Rs 329 per share on the BSE in intra-day trade on Wednesday after the telecom services company said that the global investors comprising Warburg Pincus, Temasek, Singtel, SoftBank Group International and others will invest $1.25 billion in company’s subsidiary Airtel Africa.

The proceeds will be used to reduce Airtel Africa’s existing debt of approximately $ 5 billion and for the growth of its African operations. Airtel Africa subsequently intends an initial public offering and use the proceeds primarily for further reduction of debt.

“Airtel Africa, a UK incorporated subsidiary of Bharti Airtel, announced that six leading global investors comprising Warburg Pincus, Temasek, Singtel, SoftBank Group International and others have agreed to invest $ 1.25 billion through a primary equity issuance in the company at a post money equity value of around $ 4.4 billion,” the company said in a press release.

Airtel Africa is experiencing a healthy revenue growth in voice and data services and also a strong performance in the Airtel Money business. With 4G services live in 9 countries and in process of rollouts in most others, Airtel Africa is well placed to capture a significant market share of the rapidly growing data demand across countries, it added.

The company said the present transaction will not involve any sale of shares by existing shareholders.

At 03:16 PM; Bharti Airtel was trading 10% higher at Rs 313 on the BSE, as compared to 0.58% rise in the S&P BSE Sensex. A combined 11.32 million equity shares changed hands on the counter on the BSE and NSE so far.