Bharti Airtel on Saturday mentioned it would pre-pay $1.5 billion debt with its subsidiary Bharti Airtel International (Netherlands), utilizing the proceeds it obtained from six international entities investing in its Africa unit.
Bharti Airtel International (Netherlands) B V commenced money buy of $1.5 billion, 5.125 per cent Guaranteed Senior Notes which have been due in 2023, Bharti Airtel mentioned in a regulatory submitting.
This supply, it mentioned, has been made with a view to “pro-actively manage its capital structure, reduce gross debt and leverage by acquiring the Notes funded out of equity proceeds and also provide liquidity to Noteholders at a premium to the market.”
Bharti Airtel group continues to deleverage and pursue its methods in the direction of that finish, it added.
“In line with this, it has been actively exploring various equity driven initiatives, including those previously announced regarding its Africa business, so as to pro-actively manage its balance sheet and capital structure to align them to the group’s core conservative philosophy,” it mentioned.
Bharti Airtel International’s (Netherlands) mum or dad Airtel Africa Ltd, a UK integrated subsidiary of Bharti Airtel Limited, just lately made a profitable main fairness issuance of $1.25 billion to six main international buyers, together with Warburg Pincus, Temasek, Singtel, SoftBank Group and others.
“The proceeds of this equity issuance are intended to be used to reduce Airtel Africa’s existing debt of approximately $5 billion on the date of the announcement,” it mentioned.
The proceeds of this fairness issuance at the moment are totally realised and accessible as money. The firm additionally carries natural money on its stability sheet.
“The firm needs to make the most of the proceeds of this fairness issuance and the money accessible with it to scale back its present debt by providing to buy ‘any and all’ of the Notes pursuant to the Tender Offer.
“Via the Tender Offer, the corporate can also be offering liquidity to the Noteholders at a specified premium over the market worth at launch,” the submitting mentioned.
This supply is as well as to the beforehand introduced tender supply cum reimbursement of EUR 1 billion four per cent notes maturing December 2018, for which funding has been drawn and accessible as money with the corporate.
Earlier this week, Moody’s Investors Service had positioned Bharti Airtel’s ranking on overview for downgrade on low ranges of profitability and expectation of weak money movement.
Moody’s had positioned on overview for downgrade the ‘Baa3’ issuer and senior unsecured ranking of Bharti Airtel and the scores on the backed senior unsecured notes issued by Bharti Airtel International (Netherlands) B V.