Singapore operator Singtel has announced plans to subscribe to Indian operator Airtel’s rights issue at an issue price of INR 535 per share for a total consideration of up to INR 29.4 billion (USD 405 million) over a period of up to three years. This represents Singtel’s full rights entitlement for its direct stake of 14 percent. Upon closing of the rights issue, Singtel will continue to be Airtel’s single largest shareholder.
Airtel expects to raise in total up to INR 210 billion from the rights issue to support network investments, including 5G capabilities. With smartphone users in India forecast to reach over 900 million in the next two years, Airtel seeks to capture the opportunities in areas such as 5G, home broadband, data centres, cloud services and cyber security.
Airtel shareholders will receive the right to one new share for every 14 already held. The record date for participation is 28 September, and the offering will run 5 to 21 October. Payment will consist of INR 133.75 per share to start, with two more later calls at the board's discretion for the remainder. That compares to a current trading range of around INR 730 for Airtel's stock.
Airtel reports that its India non-mobile businesses, such as home broadband, have grown significantly to account for over 25 percent of total revenue. Airtel has operations in 18 countries across South Asia and Africa and a mobile customer base of over 440 million. It has been an associate of the Group since Singtel acquired a stake in 2000.
The rights issue remains subject to regulatory approval.
