Telecommunication company Bharti Airtel's Africa unity Airtel Africa is raising a massive $1.25 billion investment from 6 top investors that include Warburg Pincus LLC, Temasek Holdings, Singapore Telecommunications Ltd and SoftBank Group Corp. The combined investment from the six companies is potentially paving a way for an IPO launch as well. Bharti Airtel through a statement said that a significant part of the investment will be used the company the clear the current $5 billion by and then expand the operation of the company in the other regions of the continent.
Raghunath Mandava, the company's managing director and chief executive officer for Africa talking about the investment said, “The transaction will help us further deleverage our balance sheet and boost our capacity to upgrade networks, expand coverage in different markets and achieve rapid growth of Airtel money across our operations.
As long as the investors are concerned, Warburg Pincus has been an investor to Bharti Airtel for almost 20 years now. It had invested for the first time in 1999. It had later made an exit from the company, marking it as the largest exit of $1.83 billion in 2004 and 2005. Singtel’s CEO Arthur Lang commenting on the transaction said, “Our investment into Airtel Africa reflects our confidence in the long-term growth potential of Africa with its young and growing population."
Notably, Airtel currently has a presence in Nigeria, Chad, Congo-Brazzaville, Democratic Republic of Congo, Gabon, Madagascar, Niger, Kenya, Malawi, Seychelles, Tanzania, Uganda, Zambia and Rwanda where it is the second largest company with a user base of 91 million in the region.
In India, the tariff war between the other telcos of intensified like never before and the investment in the Africa unit will give the company a little bit of breather.
Image Courtesy : teleanalysis