Bharti Airtel has initiated a massive fund raising exercise, estimated at up to USD 1 billion (about Rs 7,000 crore), via a bond issue by its subsidiary Network i2i, the proceeds of which will be used to cut debt for the telco that is engaged in a turf war in the Indian telecom market.
The mega fund raiser comes just months after the Sunil Mittal led company raised Rs 25,000 crore through a rights issue.
The telecom sector has been battered by falling tariffs, eroding profitability, and mounting debt, in the face of stiff competition triggered by disruptive offerings of Reliance Jio, owned by Mukesh Ambani.
But with the market for voice and data growing at an explosive pace and intensifying competition, telecom operators have been investing in strengthening networks, and preparing war chests to protect their turfs.
In a regulatory filing on Tuesday, Bharti Airtel announced that an "...offering of USD denominated Guaranteed Subordinated Perpetual Securities by Network i2i Limited (a direct 100 per cent subsidiary of Bharti Airtel) expected to be rated 'BB' by both S&P and Fitch may follow, subject to market conditions."
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