Airtel Africa, which has telecom operations in 14 African countries, will receive $1.25 billion investment from six investors including Warburg Pincus, Temasek, Singtel, SoftBank Group International and others.
Airtel will use the proceeds to reduce Airtel Africa’s existing debt of approx. $5 billion and for growth of its African operations. Airtel Africa aims for an Initial Public Offering (IPO) and will use the proceeds primarily for further reduction of debt.
Singtel in a separate statement said it will invest $250 million in Airtel Africa. Singtel holds a 39.5 percent effective stake in Bharti Airtel.
Airtel said the present transaction will not involve any sale of shares by existing shareholders.
“The transaction will help us further deleverage our balance sheet and boost our capacity to upgrade networks, expand coverage in different markets and achieve rapid growth of Airtel Money across our operations,” Raghunath Mandava, MD and CEO, Africa, Bharti Airtel, said.
Airtel Africa’s Q1 fiscal 2018-19 revenues grew 13.9 percent — led by 75 percent growth in mobile data traffic, 45.2 percent increase in data customers and 43 percent increase in Airtel money transaction value. Airtel Africa’s cost control initiatives have resulted in improvement of EBITDA margin by 7.8 percent to 36.4 percent.
Airtel Africa is the second largest telecom operator in the continent with a customer base of 91 million. It ranks among the top two operators in most of its 14 markets. Airtel Africa has been delivering healthy revenue growth in voice and data services.
Airtel Africa has also performed strongly in its mobile wallet service, Airtel Money, which has 11.8 million subscribers. Airtel Africa’s 4G services are live in 9 countries and will be launching in most others.
Africa is projected to be the world’s second-fastest growing economic zone and the fastest growing mobile market with unique mobile subscribers expected to increase from 420 million in to more than half a billion by 2020.
