Bharti Telecom seeks to buy balance stake in Singtel

Bharti Telecom (BTL), a key promoter company of Bharti Airtel, plans to raise up to Rs 6,000 crore of debt via non-convertible debentures (NCDs) to buy the balance portion of the 3.33% stake that Singapore Telecommunications (Singtel) will sell in the Indian telco.

The proposed rupee-linked NCDs are likely to be subscribed primarily by top foreign portfolio investors (FPIs). Some local institutional investors are also expected to participate. BNP Paribas, HSBC, Japan’s MUFG and Standard Chartered Bank among others are likely helping BTL to raise the money via rupee-linked NCDs.

Last week, Singtel sold 1.76% in Airtel through block deals for a little over Rs 7,100 crore. Around 1.62% of the stake was acquired by BTL for Rs 6,604 crore, while the balance (0.14%) was acquired by public shareholders in Airtel. BTL is now raising fresh debt to part-finance the remaining 1.57% stake buy from Singtel.

Bharti Group has to raise debt to fund the Singtel stake purchase as the southeast Asian carrier recently ruled out any fresh equity infusion in BTL. The Mittals of Bharti Enterprises and Singtel own 50.56% and 49.44%, respectively, in BTL, which in turn, owns a shade over 37% in Bharti Airtel.