Bharti Airtel raises $750 million via maiden issue of perpetual bonds

Our Bureau New Delhi | Updated on October 10, 2019 Published on October 09, 2019

The proceeds will be used for refinancing, investments in subsidiaries and for general corporate purpose   -  REUTERS

Company to use proceeds to deleverage and strengthen its balance sheet

Telecom major Bharti Airtel has achieved a new milestone with its inaugural hybrid securities offering, raising $750 million in the international markets through its 100 per cent owned Mauritius-based subsidiary Network i2i Limited.

The is the first subordinated perpetual securities issue by an investment-grade corporate out of India. Bharti Airtel has guaranteed the hybrid securities, which have been priced at a yield of 5.650 per cent under Rule 144A/Regulation S offering.

A RegS status means that the securities need not be registered with the US Securities and Exchange Commission. Also, Rule 144A offering enables the securities (perpetual securities) to still be sold to institutional investors in the US, sources in the investment banking industry said.

The $750 million raised will be used for refinancing, investments in subsidiaries and for general corporate purpose.

As regards geographical representation of investors, as many as 38 per cent each came from Asia and Europe and the US accounted for 24 per cent. As regards the type of investors, as many as 79 per cent of the investors were fund managers/asset managers; 10 per cent were insurance companies; and 11 per cent were banks/private banks, sources said.

The perpetual securities will be listed on the Singapore Stock Exchange, they added.

Ashish Sardana, Head – Treasury, Bharti Airtel, said: “We continue to be focused on strengthening our balance sheet and this subordinated perpetual issue with 100 per cent accounting equity treatment helps us in deleveraging further. We are delighted by the outcome of this transaction and the continuing support and appreciation of our credit by the global investor community.”

Barclays Bank PLC, BNP Paribas, Citigroup Global Markets Limited, The Hongkong and Shanghai Banking Corporation, J.P. Morgan Securities, Merrill Lynch (Singapore) Pte Ltd and Standard Chartered Bank], acted as Joint Bookrunners.

Published on October 09, 2019
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