New Delhi: Telecom operator Bharti Airtel said Wednesday it has raised USD 750 million (about Rs 5,330 crore) from investors based in Asia, Europe and the US through a hybrid financial instrument.
Bharti Airtel said in a statement that ‘its wholly-owned subsidiary Network i2i Limited, has priced… offering of USD 750 million 5.650 per cent subordinated perpetual securities’. A perpetual bond is a fixed income security with no maturity date that yields a steady flow of interest payments.
The company said it will use the proceeds for refinancing, investments in subsidiaries and general corporate purpose.
As on June 2019, Bharti Airtel’s total debt stood at a staggering Rs 1.16 lakh crore. The mega fund raiser comes just months after Airtel raised Rs 25,000 crore through a rights issue.
The company’s treasury head Ashish Sardana said in the backdrop of the current global economic environment, the strong response for its inaugural hybrid securities offering from high quality investors across Asia, Europe and the US underlines the future growth potential of its business.
“The securities have been distributed to fund/asset managers, insurance companies etc,” a banker closely involved in the transaction told this agency.
Barclays Bank PLC, BNP Paribas, Citigroup Global Markets Limited, HSBC, JP Morgan Securities, Merrill Lynch (Singapore) Pte Ltd and Standard Chartered Bank acted as joint bookrunners for the offering.
The telecom sector has been battered by falling tariffs, eroding profitability and mounting debt in the face of stiff competition triggered by disruptive offerings of Reliance Jio, owned by Mukesh Ambani.
But with the market for voice and data growing at an explosive pace, telecom operators have been investing in strengthening networks and preparing war chests to protect their turfs.
It should be stated here that Bharti Airtel had posted a loss of Rs 2,866 crore for the June quarter, its first consolidated loss in 14 years, as it lost ground to rival Reliance Jio and took a hit from exceptional items such as charges towards accelerated depreciation of 3G network gear.
Airtel had logged a net profit of Rs 97 crore in the June quarter of the previous fiscal.
PTI