Bharti Airtel has put the company’s Bangladesh tower assets on its divestiture list as the world’s fourth largest mobile telephony firm seeks to raise more than $2 billion from selling its infra networks to bolster cash reserves, said people directly aware of the matter.
The Sunil Mittal-led Bharti has received offers from potential acquirers to sell its tower networks in Africa and Bangladesh in separate deals, they added. Bharti’s move to sell its 4,000-strong Bangladeshi tower network is a fresh development, while a deal involving its African towers has been a subject of some speculation.
The mobile operator expects at least $200 million from divesting its towers in Airtel Bangladesh, said sources who did not wish to be named since talks are private. Bharti Airtel took full control of its mobile service operations in Bangladesh last year, buying out a 30% stake held by Warid Telecom, a wholly-owned subsidiary of the Abu Dhabi Group.
The Delhi-headquartered telco has about 6.7 million subscribers in the South Asian country, while it boasts of a 66.3-million customer base across 17 African nations. “As a company policy, we do not comment on market speculation,” a Bharti spokesperson said in response to queries on impending tower asset sales.
India’s largest private telecommunication firm has searched for an M&A play for its African towers in the recent past, and explored joining forces with local rivals to create a common tower company. Bharti expects between $1.5 billion and $1.8 billion from selling its network of 15,000 towers in the African continent. Sources said that US and Middle Eastern tower management companies – in some cases backed by financial investors – have bid for both the Bangladesh and African assets.
Bharti is possibly bolstering its war chest for the impending spectrum auction and may be looking at inorganic growth on its home turf as a new-look telecom M&A regime kicks in. The latest fund-raising move coincides with India’s upcoming spectrum auction, where Airtel will be pitched against the cash-rich Vodafone and Mukesh Ambani’s Reliance Jio to renew its airwaves in the 900MHz band.
Sectoral analysts said the sale of tower assets could be an independent move, and possibly aimed at securing the company’s balance sheet carrying a $9.3-billion debt, mainly emanating from the acquisition of Kuwaiti telecom giant Zain’s African unit four years ago.
The company, in which SingTel is a large strategic investor, raised well over a billion euros through a bond offering recently. It also sold a 5% stake to Doha-based Qatar Foundation Endowment for $1.26 billion in May last year. It had raised $800 million through a stock market listing of its Indian tower unit Bharti Infratel in December 2012.
Bharti has explored several routes to unlock capital, including a stake sale in its direct-to-home unit, to pay down debt. Media reports also pointed to a possible exit from some markets like Sri Lanka if it fetched good valuations.