Airtel Africa Ltd, a subsidiary of India’s Bharti Airtel Ltd, said it had raised $1.25 billion from SoftBank Group Corp, Warburg Pincus LLC, Temasek Holdings (Private) Ltd, Singtel and two other investors.
Airtel Africa said funds were raised through a primary equity issuance. The fundraising, which will be used to reduce existing debt of about $5 billion and grow its Africa operations, now values the telecommunications company at $4.4 billion.
Chief Executive of Bharti Airtel’s Africa unit, Raghunath Mandava said “the transaction will help us further deleverage our balance sheet and boost our capacity to upgrade networks, expand coverage in different markets and achieve rapid growth of Airtel Money across our operations”.
Airtel, like its peers, has been trying to shed debt and aggressively win customers, especially since it has been faced with a price war in India with the market entry of Reliance Jio in 2016.
Back in September, Reuters reported that Bharti Airtel chose UBS Group AG, JPMorgan Chase & Co and Citigroup Inc to coordinate the London initial public offering of its Africa business. Airtel Africa said it aimed to go public on an international stock exchange in a deal where the proceeds would also be used to reduce debt.
A statement released by the company said “Airtel Africa has seen a turnaround of its business in recent years. This investment demonstrates the confidence of leading global investors in the company’s ongoing robust growth and profitability”.
Airtel operates in 14 African markets including Democratic Republic of the Congo, Kenya, Nigeria, Rwanda, Seychelles, Uganda and Zambia. The continent accounted for over a quarter of Bharti Airtel’s June-quarter revenue of about $2.74 billion.