Bharti Airtel said on Wednesday that it has transferred 11.32% stake in Bharti Infratel to its wholly-owned company Nettle Infrastructure Investments for Rs 6,806 crore, just a day after it sold a 10.3% stake in the telecom towers and infrastructure arm to a consortium of the private equity firm KKR & Co and the portfolio manager Canada Pension Plan Investment Board.
Post the stake transfer announced today, Bharti Airtel will directly hold 50.33% equity in Bharti Infratel, while Airtel’s subsidiary Nettle Infrastructure will hold the 11.32% that it has bought, the company said in a intimation to the stock exchanges.
Bharti Infratel shares surged further, building on yesterday’s strong gains, and were trading at Rs 330.2, up 3.6% from the previous close.
Earlier yesterday, Bharti Airtel had said that it has sold 10.3% stake in Bharti Infratel to KKR and Canada Pension at Rs 325 per share, for a total consideration of Rs 6,194 crore.
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Bharti Airtel, India’s largest telecom service provider, had said it will use the proceeds from the sale primarily to reduce its debt. Following the closure of this transaction, Bharti Airtel’s equity holding in Bharti Infratel stands at 61.7%, and that of KKR and CPPIB at 10.3%.
Post this transaction, the stake held by KKR and CPPIB (combined) will be the single largest public shareholder block, Bharti Infratel said. The transaction marks KKR’s second investment in Bharti Infratel. Previously, the funds managed by KKR had invested in Bharti Infratel during the period 2008 to 2015.
Bharti Airtel is due to be dislodged to the second position in the Indian telecom market, after the mega merger between its two largest rivals Vodafone India and Idea Cellular, which was announced earlier last week.
Earlier last week, Bharti Airtel also announced acquisition of wireless broadband internet service provider Tikona Digital Network’s 4G business for Rs 1,600 crore. The deal includes buyout of Tikona’s Broadband Wireless Access spectrum and 350 sites in five telecom circles.
Recently, Bharti Airtel also acquired smaller telecom operator Telenor India to further augment its customer base and network, amid the ongoing consolidation in the Indian telecom sector after the entry of Reliance Jio with its free voice and data services.