Telecom major Bharti Airtel yesterday said it has raised over Rs 2,100 crore from its sale of 4.5 percent stake in Bharti Infratel and the share sale helps the mobile tower unit comply with SEBI’s minimum public shareholding norms.
The Offer for sale (OFS), which opened and closed today on the BSE and the NSE, was for 4.5 crore shares with a greenshoe option of additional 4 crore shares, taking the total issue size to 8.5 crore. While the floor price of the OFS was Rs 250 per share, the indicative price is Rs 251.71, as per exchange data. The strong demand for the issue allowed the final price to be at a premium to the floor price, the company said.
With the offer, Bharti Airtel’s equity holding in Bharti Infratel has come down to 74.86 percent, well ahead of the December 2015 timeline to comply with SEBI’s minimum public shareholding norm of 25 percent, it added. At the end of June, Bharti Airtel held 79.36 percent in Bharti Infratel. “Successful completion of the Offer For Sale of 85 million shares of its subsidiary Bharti Infratel Limited for a total consideration of over Rs 2,100 crore, approximately$350 million,” the company said. The offer was over-subscribed 2.4 times, it added. Bharti Enterprises Vice Chairman Akhil Gupta said, the firm is pleased with the strong investor response to the offer. The proceeds from the offer will allow Bharti Airtel to further “deleverage” through debt reduction, he added.
The net debt of Bharti Airtel at the end of first quarter ended June 30, 2014 stood at Rs 57,744.3 crore. “The OFS got a global response, with investors including new ones, participating from US, Asia, Europe and India, leading to it being the largest OFS from the Indian private sector,” Bharti Airtel’s Group Treasurer Harjeet Kohli said. He added that broadening the investor base through this offer would also provide higher trading volumes in Bharti Infratel stock. DSP Merrill Lynch Limited, JP Morgan India Private Limited and UBS Securities India Private Limited were the brokers for the Offer.
Shares of Bharti Infratel closed at Rs 253.05 a unit, down by 6.59 percent, compared to previous close at BSE. The mobile tower firm has plans to invest Rs 1,345.7 crore in capital expenditure by the end of this fiscal. Bharti Infratel is one of the largest tower infrastructure providers in India. The company had raised Rs 3,165.7 crore in 2012 though its initial public offer. Shares of Bharti Airtel closed at Rs 366.05 a unit, down by 0.38 percent compared to previous close, at BSE yesterday.