Singtel will sell 3.3 percent direct stake in Bharti Telecom to its 49.4 percent-owned JV entity, Bharti Telecom, for S$2.25 billion ($1.61 billion).
Bharti Telecom will finance this acquisition via debt without the need for capital infusion from its shareholders including Singtel and Sunil Mittal family.
Following this transaction, Singtel will see its effective stake in Bharti Airtel reduced from 31.4 percent to 29.7 percent.
Singtel expects to cumulatively invest SGD2-2.5 billion in 5G incremental Capex (mainly in Australia) and SGD2 billion in growth initiatives (like NCS, data center and Digibank).
Following this transaction, Singtel will hold a 10.5 percent direct stake in Bharti Airtel and a 19.2 percent indirect stake via Bharti Telecom wherein Singtel retains a 49.4 percent stake.
Singtel, southeast Asia’s largest telecom firm, said its units Pastel and Viridian would together sell 198 million shares they hold in India’s second-biggest telecom operator — as part of it capital recycling strategy.
Singtel said proceeds from the sale will be used to reduce the group’s debt and fund 5G Capex (capital expenditures) and growth initiatives.
Singtel last month said it would sell its loss-making digital marketing arm Amobee for $239 million, monetised a 1.6 percent stake in Airtel Africa for about S$150 million in March, and sold 70 percent stake in its Australian tower network for A$1.9 billion last year.
Divestments in ATN and the partial divestment of Airtel Africa (1.6 percent) have raised more than S$2 billion and more is in the pipeline. Post this S$2.2 billion sale, Singtel aims to raise another S$1 billion over the mid-term to fund its growth engines – NCS, Digibank and Data centre initiatives.
