(Mar 7): Singapore Telecommunications (Singtel) said it will buy roughly US$525 million ($712.4 million) worth Bharti Airtel stock as part of the Indian telecoms operator's plan to raise US$4.6 billion through new shares and bonds.

The fund raising plan, announced last month, is aimed at cutting debt and shoring up Bharti Airtel's balance sheet as the Indian telecom industry reels from the impact of a price war triggered by the entry of Reliance Jio Infocomm.

Under the plan, Bharti Airtel is looking to sell new shares worth 250 billion rupees ($4.8 billion) for 220 rupees apiece, nearly 30% discount to its current stock price, and raise 70 billion rupees via foreign-currency denominated perpetual bonds.

After the rights offering, Singtel's effective interest in Airtel will be 35.2%. Singtel has a direct equity stake of about 15%, according to Refinitiv data.

"Our participation in this rights offering ... reflects our long-standing commitment to Airtel and the confidence in the future of the Indian market," Arthur Lang, CEO of Singtel's International Group, said.

Bharti Airtel's two other major shareholders -- Bharti Group and Bharti Telecom -- intend to subscribe to their full entitlement, while Singapore's state-backed GIC will commit about 50 billion rupees, Bharti Airtel and Singtel said.

Rising competition in India and waning profits at Bharti Airtel, which reported in January that its quarterly earnings plunged by three quarters, also had a knock-on impact on Singtel, Southeast Asia's largest telecom operator.

Last month Singtel reported a 14% drop in third-quarter net profit, hurt partly by intense competition in India that hit Airtel.

Singtel to buy US$525 mil worth of stock in India's Bharti Airtel

DPM Lawrence Wong appointed as GIC’s deputy chairman

Will the Rising Sun keep rising?

Fed signals higher-for-longer rates with hikes almost finished

EQT Impact Challenge offers platform for impact entrepreneurs to attain 'patient capital'

Singtel to sell 20% stake in regional data centre business valued at $5.5 bil

Singapore investment banking fees down 20% y-o-y so far this year, DBS leading: Refinitiv

Boustead Singapore is 'big, bold and beautiful', says OCBC

RHB remains positive on ST Eng for its ‘strong’ earnings potential and ‘well-supported dividend yield’

Singtel to buy US$525 mil worth of stock in India's Bharti Airtel

Related News

Highlights

DPM Lawrence Wong appointed as GIC’s deputy chairman

Related News

Singtel launches one-stop cyber security resilience programme for SMEs

Analysts upbeat on Singtel's outlook as it unlocks more value with latest divestment

Singtel subsidiary NCS announces partnerships with Dell, Visa, Google Cloud unit