Airtel to acquire 20pc stake in Bharti Telemedia

The proposed transaction is part of Airtel’s strategy to align the shareholding of its customer facing products, services and businesses under the same holding group.

Hyderabad: Bharti Airtel said that it will acquire a Warburg Pincus affiliate’s 20 per cent equity stake in its DTH arm Bharti Telemedia for a total consideration of Rs 3,126 crore, which will be discharged primarily via issuance of about 36.47 million equity shares of Airtel at a price of Rs 600 per share and up to Rs 1,037.8 crore in cash.

The proposed transaction is part of Airtel’s strategy to align the shareholding of its customer facing products, services and businesses under the same holding group. A full control and ownership over Bharti Telemedia allows Airtel to offer differentiated and converged solutions to customers so as to promote “One Home” strategy.

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Harjeet Kohli, group director, Bharti Enterprises said, “DTH is an integral part of our Homes strategy and this transaction is another step towards simplifying the shareholding of our customer facing businesses providing structural flexibility and ease of implementation.”

Airtel will issue its shares to the Warburg Pincus affiliate at a premium of about 0.50 per cent to the floor price determined as per regulations. The remaining consideration of Rs 937.8 crore shall be paid in cash on the closing date of the proposed transaction. There may also be minor customary closing adjustments not exceeding Rs 100 crore.

Vishal Mahadevia, MD and head of Warburg Pincus India said, “Airtel was one of the earliest and most profitable investments for Warburg Pincus in India. We are delighted to be back as partners in Bharti Airtel through this transaction. We look forward to capitalising on the broad-based growth that the company is witnessing across its entire portfolio of businesses, including the digital build-outs.”

Citigroup Global Markets India acted as the financial advisor to Airtel and Credit Suisse Securities (India) acted as advisors to Warburg Pincus in connection with this transaction.

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