Bharti Airtel set to raise Rs 3,000 crore via CPs

Bharti Airtel plans to issue non-convertible debentures worth up to Rs 3,000 crore on a private placement basis, the company said in an exchange filing late on Thursday. For this, a meeting of the committee of directors is scheduled for March 13, the company said.

“The company is seeking approvals in the usual course of business. Any funds raised under such approvals, if granted, are to be used for routine treasury activities including refinancing of debt and spectrum liabilities,” a spokesperson for Bharti Airtel said in a statement on March 9.

This is expected to boost the company’s funding plans to take on competition from Reliance Jio.

Companies in the debt-laden telecom sector witnessed a double whammy after the entry of Reliance Jio Infocomm Ltd brought tariffs to rock-bottom levels and hit revenue streams of other operators.

In February, Bharti Airtel had said the unit managing its Africa operations is considering a potential initial public offering (IPO).

The company has also announced several measures to reduce debt to be in a stronger position to combat competition from Reliance Jio. Bharti Airtel recently announced that Singapore Telecommunications Ltd (Singtel) will indirectly raise its stake in Bharti Airtel by investing Rs 2,649 crore in Bharti Telecom Ltd, the promoter company, through a preferential allotment of shares. The money will be used to reduce debt.

In December, Airtel had said that it, along with another group entity, will sell a combined 20% in its DTH arm Bharti Telemedia Ltd to private equity firm Warburg Pincus for $350 million.

Airtel last year also said it may sell a controlling stake in tower arm Bharti Infratel. Bharti Airtel and its wholly-owned arms own 53.51% in the tower company at present. Meanwhile, its rival Idea Cellular too raised funds to build a war chest for the battle in the telecom sector.

The promoters of Idea Cellular Ltd — Birla TMT, Elaine Investments, Oriana Investments — have already invested Rs 3,250 crore to strengthen its balance sheet amid intense competition and before a planned merger with Vodafone India Ltd. MorungExpress