Airtel forms panel to explore options to raise fresh funds

NEW DELHI: Bharti Airtel Ltd has formed a special committee to explore and evaluate fund-raising options with an aim to strengthen the company’s capital structure and balance sheet as it battles an aggressive new entrant Reliance Jio Infocomm Ltd in the telecom arena.

This committee will place its recommendations before the board for final approval, Airtel said in a filing to the exchanges on Thursday. The firm did not disclose the quantum of funds it aims to raise. It did not give any time frame for raising the funds.

Infusing funds is critical for Bharti Airtel to stay in the telecom battlefield as it faces a mountain of debt. Its net profit plunged 65% from the year earlier in the September quarter to ₹118.8 crore. Total revenue declined 6.2% to about ₹20,422 crore.

In October, Airtel had said half a dozen marque i nvestors, including Warburg Pincus LLC, Temasek Holdings, Singapore Telecommunications Ltd (Singtel) and Softbank Group Corp., will invest a combined $1.25 billion in Airtel’s unit in Africa ahead of a potential initial public offering and the funds would be used to trim Airtel Africa Ltd’s debt of $5 billion and expand operations there.

As part of steps to cut debt and monetize assets, Airtel in August sold a 20% stake in its satellite television arm, Bharti Telemedia

Ltd, to private equity firm Warburg Pincus for $350 million.

The board of Airtel on Thursday also approved transferring up to 591.87 million shares, or a 32% stake, in its unit Bharti Infratel to a wholly owned unit, Nettle Infrastructure Investments Ltd.

This is part of Airtel’s strategy to monetize its stake in Bharti Infratel, which is also in the process of a merger with Indus Towers Ltd.