Singtel has struck a deal to sell its 3.3% stake in Bharti Airtel to Bharti Telecom for SGD2.3 billion (US$1.6bn), a move to fund 5G capex and growth initiatives.
In a statement, Singtel detailed that Bharti Telecom is a joint venture between it and Bharti Enterprises, with the deal expected to be completed before November 23.
The deal will reduce Singtel’s shares in Bharti Airtel to 29.7% which is estimated to be worth SGD22 billion, the company said it will “remain fully committed to Airtel’s next phase of growth”. Singtel’s stake comprises of a 19.2% indirect stake through Bharti Telecom and a 10.5% direct stake.
Singtel CFO Arthur Lang said: “As long-term strategic investors and partners, the value of our stakes in our regional associates has risen substantially over the years but has not been properly reflected in our share price.
“This sale in Airtel will be our first ever and seeks to address this gap by illuminating the sizeable value of our holdings in Airtel. It is also part of our capital management approach to take monetisation opportunities that allow us to increase our return on invested capital and enhance total shareholder returns.”
This move is the latest from Singtel to divest assets to focus on core businesses. The company recently sold a minority stake in Airtel Africa for around SDG150 million.
