Bharti To Divest In Televentures Through Ipo
Bharti Telecom and its joint venture partners, Telecom Italia and EM Warburg Pincus, plan to offload 16 per cent stake in Bharti Televentures,
the holding company for the group's cellular operations, through an initial public offering.
The partners are expected to pump in an additional $200 million to fund its investment plans.
Also Read
Bharti, which plans to invest around Rs 3,000 crore in the next three years, is expected to raise around $200 million by offloading the 16 per cent stake in Bharti Televentures.
The chairman and group managing director of the holding company, Bharti Enterprises, Sunil Bharti Mittal, told Business Standard that the rest of the funds requirement for the Rs 3,000 crore investment would be met through debt.
There could be a domestic or overseas listing, but the initial public offering would be floated during the second half of the current year, Mittal said.
He pointed out that the funds would be raised for acquisitions, new licences and long-distance telephony. And he did not rule out the possibility a Nasdaq or NYSE listing.
Morgan Stanley and Merrill Lynch have been given the mandate to look into the various aspects of listing, and the group is implementing the US accountancy standards, according to Mittal. He said he expected the subscriber base to reach one million by March 2001.
According to the current equity structure, Bharti Telecom holds 61 per cent stake, Telecom Italia around 20 per cent and EM Warburg Pincus around 19 per cent.
Post-initial public offer, Bharti Telecom's share is expected to come down to around 52 per cent and that of Telecom Italia, EM Warburg Pincus and the public to around 16 per cent.
Mittal, however, ruled out any move to split the group among his brothers. He also said he was not interested in bidding directly for any of cellular services. "It would be extremely arrogant for us to do such a thing," he said.
He said most of the acquisitions have happened because of bankers who had put them on the table. Starting with cellular services in Delhi in 1995 and Himachal Pradesh in 1996 and fixed line services in Mahdya Pradesh in 1998, Bharti has recently acquired cellular properties in Karnataka, Andhra Pradesh and Chennai.
Recently, the firm acquired JT Mobile, which provides cellular services in Karnataka and Andhra Pradesh, for around Rs 450 crore. With the launch of Bharti's services yesterday in Bangalore, the JTM brand has been merged with AirTel. In Chennai, Bharti bought a controlling stake from Crompton Greaves-DSS combine for around Rs 150 crore. Mittal said JTM had incurred a loss of around Rs 600 crore. He said once the subscriber base reached around 1 lakh each in Karnataka and Andhra, tariffs could be reduced.