Bharti Airtel files for nearly $1bn IPO

Investment Corporation of Dubai is a minor stake holder of the Indian telco giant
Bharti Infratel's IPO is likely to be launched in January, a sources told Reuters.
Bharti Infratel's IPO is likely to be launched in January, a sources told Reuters.

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Indian mobile phone carrier Bharti Airtel, in which a Dubai sovereign wealth fund owns a minor stake, filed a draft prospectus with the capital markets regulator this weekend for an initial public offering (IPO) that aims to raise nearly US$1bn, two sources with direct knowledge of the matter told Reuters.

Bharti Infratel's IPO is likely to be launched in January, the sources told Reuters, declining to be named as the information is not public yet.

In a separate statement to the stock exchange, Bharti Airtel, which owns about 86 percent of Bharti Infratel, said it had decided not to participate in the share sale.

A Bharti spokesman declined to comment beyond the statement.

Bharti Infratel, which has more than 33,000 mobile phone masts, also holds a 42 percent stake in joint venture Indus Towers, which is the world's biggest telecoms mast company, with about 110,000 masts.

Mast companies get their revenue from leasing infrastructure to network operators but they are going through a tough time in India currently as a Supreme Court order to revoke the regional operating licences of eight mobile phone companies in the 15-player market has weighed on demand for masts.

Bharti Airtel owns 86 percent of the Infratel unit, with the remainder held by investors including Temasek Holdings, Kohlberg Kravis Roberts & Company, Goldman Sachs, Macquarie Group, Citigroup, Investment Corporation of Dubai and AIF Capital.

Bharti Airtel said last month it was considering a sale of up to 10 percent of Infratel in the IPO.

Bharti Airtel, which in 2010 acquired in a US$9bn deal the mobile operations in 15 African countries of Kuwait-based telecoms group Zain, had net debt of about US$12bn at end-June.

The company has reported 10 consecutive quarters of profit decline, hit by fierce competition in its home Indian market and also weighed on by losses in its African business.

Its shares are down about 28 percent so far this year after a slew of brokerage downgrades in August, underperforming the broader market that is up more than 16 percent.

* With Reuters

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