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Bharti Airtel raises $1B in oversubscribed debt issue

04 June, 2015

Bharti Airtel Ltd, the country’s top and the world’s fifth largest telco by subscriber numbers, has raised $1 billion by issuing 10-year notes, which was oversubscribed two times, to overseas investors, according to a stock market disclosure.

The notes, priced at a coupon rate of 4.375 per cent per annum to yield 4.462 per cent, are expected to carry a final rating of investment grade from Fitch, S&P and Moody’s.

Of the total, nearly 66 per cent bonds allocated to the US investors, the highest ever allocation to US investors in any Indian debt deal, while those from Europe (18 per cent) and Asia (16 per cent) brought in the rest. In terms of segment allocation, nearly 80 per cent allocation was made to mutual funds and insurance companies, with the balance to banks.

“With bond issuances of close to $6 billion outstanding post this issue, Bharti now has a well-established credit curve across tenure buckets and currencies. These, along with the availability under our long dated ECB terms signed recently with Chinese banks (CDB and ICBC), significantly elongate the tenor of our financing as also helps larger cash flows at hand,” Harjeet Kohli, group treasurer, Bharti Airtel said.

Bank of America-Merrill Lynch, Barclays, BNP Paribas, Deutsche Bank, HSBC and Standard Chartered Bank acted as joint lead managers, while DBS Bank Ltd was the co-manager for the issue.

In May last year, the company had raised around $2 billion in duel currency international bond sale for repayment and refinancing of existing foreign currency debt.

With operations in 20 countries across Asia and Africa, Bharti Airtel ranks amongst the top five mobile service providers globally in terms of subscribers. China Mobile is the world’s largest telecom operator both in terms of customer base and revenue.

It has made a few overseas expansion moves in the past including its purchase of Zain’s African assets that has in turn stretched its balance sheet.

Shares of the company were trading at Rs 416.85 a share, down 1.04 at 3:15 PM on BSE in a weak Mumbai market on Thursday.


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Bharti Airtel raises $1B in oversubscribed debt issue

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