Singtel spends $413m on increasing stake in Airtel

Singtel is increasing its stake in Indian and African operator Bharti Airtel at a cost of $413 million.

The company is carrying out the process by buying 85 million new shares in Bharti Telecom, the holding company of Bharti Airtel. As a result Singtel’s economic interest in Airtel will increase by 0.9 percentage points to 39.5%.

Arthur Lang, CEO of Singtel International, said: “This is a good opportunity for us to deepen our strategic partnership with Airtel. While there are currently headwinds in India, we take a long-term view of our investment in Airtel which continues to be a strong market leader in a region with rapidly increasing smartphone penetration and mobile data adoption.”

Airtel has a 31% share of the Indian mobile market following the takeover of Telenor India and Tata Teleservices, putting it behind the combination of Vodafone India and Idea Cellular, which will have a 34% share.

But it also has operations in 15 other countries across South Asia and Africa and a total customer base – including India – of over 390 million. Singtel first acquired a stake in 2000.

The deal will be done by a preferential share allotment by the end of March, after which Singtel’s stake in Bharti Telecom, the holding company, will rise by 1.7 percentage points to 48.9%. Bharti Telecom holds 50.1% of the share capital of Bharti Airtel. The deal values Bharti Airtel at $45 billion.

International operations now account for 75% of Singtel’s earnings. As well as Airtel, it owns stakes in operators AIS in Thailand, Globe Telecom in the Philippines, Optus in Australia and Telkomsel in Indonesia, plus online TV service Hooq.