Six investors Softbank group, Warburg Pincus, Temasek and Singtel International, will invest $1.25 billion through a primary equity issue in Airtel Africa, the telecom company said in a statement today.
The telecom operator, facing brutal competition from Reliance Jio Infocomm Ltd, would use these proceeds to reduce Airtel Africa’s existing debt of $5 billion and for growth of its African operations, it said.
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Bharti Airtel’s UK incorporated subsidiary Airtel Africa subsequently intends an initial public offering and plans to use the proceeds primarily for further reduction of debt.
Bharti Airtel had on 14 February announced its plan to list its African arm. After the transaction the entire equity value of the African unit will be close to $4.4 billion, the company said.
Bharti Airtel’s Africa venture started in 2010 when it bought Zain’s Africa operations for $10.7 billion. Over the past few years, it has been trying to capture the African market through local deals. It has made three small acquisitions in the continent in Uganda, Congo Brazzaville and Kenya.
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