Airtel buys stake 4.94% in Bharti Infratel via block deals for Rs 2,882 crore

Bharti Airtel, India’s second-largest telco, increased its stake in tower unit Bharti Infratel by buying a 4.94% stake in open market block deals for Rs 2,882.32 crore, according to a filing.

The stake was acquired from private equity firm Providence Equity Partners, which sold 77.08 million shares for an average of ₹215.44, aggregating to ₹1,660.61 crore. These were held through P5 Asia Holding Investments Mauritius Ltd and EdgePoint Global Portfolio and EdgePoint Growth & Income Portfolio, which sold 31.21 million and 18.11 million shares, respectively, for ₹672.83 crore and ₹390.44 crore.


According to Mint, prior to the acquisition, Bharti Airtel and Nettle Infrastructure held 23.04% and 13.69%, respectively, in Bharti lnfratel. With this acquisition by Nettle, the aggregate shareholding of Bharti Airtel and Nettle has increased from 36.73%in the September quarter to 41.66% in lnfratel.

“Nettle Infrastructure Investments Ltd, a wholly-owned subsidiary of the company, has acquired an additional equity stake of 4.94% (or 13.3 crore shares) in Bharti Infratel Ltd. today,” Bharti Airtel said in a stock exchange filing on Wednesday evening. The name of the newly merged listed entity will be changed to Indus Towers Ltd.

In September, Bharti Infratel’s board decided to proceed with the scheme for a merger with Indus Towers, and that the cash consideration chosen by Vodafone Idea Ltd for its 11.15% stake in Indus Towers is expected to be about ₹4,000 crore. The merger was completed last month.

Bharti Airtel and Nettle held a combined stake of 36.73% in Bharti Infratel. With the purchase, Nettle’s stake has increased to 18.62% and their combined stake is now 41.66%, Airtel said in the filing. Under creeping acquisition norms, promoter purchases are capped at 5% of the equity in a year.

Vodafone Idea has received cash consideration of ₹3,760.1 crore for its 11.15% shareholding in Indus, while Vodafone Group and Providence were allotted 28.2% and 3.2% respectively.

Bharti Infratel Ltd posted a 24% drop in consolidated net profit to ₹733 crore for the quarter ended September 2020 against a net profit of ₹964 crore in the corresponding period of 2019-20. Consolidated revenue grew 2% to ₹3,695 crore during the reported quarter from ₹3,638 crore in the year-ago period.

Shares of Bharti Infratel closed at ₹224.80 on Wednesday, up 4.10% from its previous close, while the Sensex lost 0.08% to close at 4,4618.04. Bharti Airtel was up 1.16%.