Bharti Infratel Ltd – Promoter Stake Sale

Company Overview

• Bharti Infratel Limited has established on November 30, 2006 as a Public Limited Company. It is a Large Cap company with a market capitalization = Rs. 59,132 Cr. It is the largest company in telecom- equipment sector. Bharti Infratel is a provider of tower and related infrastructure, and deploys, owns and manages telecom towers and communication structures for various mobile operators. Major Clients are Airtel, Jio, Vodafone, BSNL, idea, Tata Teleservices Ltd. etc.
• The Company’s consolidated portfolio consists of over 90,000 telecom towers, which includes over 38,997 of its own towers and the balance from its 42% equity interest in Indus Towers Limited, and has a presence in all 22 telecom circles in India.
• The services offered by the Company include Tower Infrastructure Solutions, Tower Operations Center, Infratel Enterprise Suite and Advantage Infratel.

shareholding pattern

Bharti Airtel Ltd’s stake to cut by 32%

• Bharti Airtel Ltd (which is currently a majority shareholder of Bharti Infratel Ltd)is going to lower its direct stake in Bharti Infratel Ltd by more than a half. Bharti Airtel Ltd : current stake = 50.33%
• After stake transfer = 18.3%
• Airtel’s unit Nettle Infrastructure Investments Ltd will buy an up to 32% stake in Bharti Infratel by March 18.
• Nettle Infrastructure Investments Ltd : current stake= 3.18%
• After transferring stake from Airtel to Nettle Infrastructure Investments Ltd , those 32 % stake will be sold to the third party.
• It will help Airtel in raising funds for its soared debts and eroded profit margin, after facing an immense competition since the entry of JIO in 2016.
• Airtel is planning to raise $4.6 billion through shares and bonds out of which $525 million worth Airtel stocks will be bought by Singapore Telecommunications Ltd
• Nettle will buy Infratel shares for up to 362.45 rupees each, a premium of up to 8.6 percent to the stock’s closing price on Monday [Rs. 333.80].

summary

1. Bharti Airtel Ltd is going to lower its direct stake in Bharti Infratel Ltd by 32% [ from 50.33% to 18.3%]
2. Airtel’s unit Nettle Infrastructure Investments Ltd having current stake of 3.18% will buy 32% stake in Bharti Infratel.
3. After transferring stake from Airtel to Nettle Infrastructure Investments Ltd , those 32 % stake will be sold to the third party.
4. It will help Airtel in raising funds for its soared debts and eroded profit margin due to high peers competiton pressure.