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Airtel Africa Raises USD 200 Mn From Qatar Investment Authority To Reduce Existing Net Debt

| January 31, 2019

Airtel Africa, a subsidiary of Bharti Airtel, has received USD 200 Mn in funding via a primary equity issuance from Qatar Investment Authority (QIA), the State of Qatar’s highest wealth fund. The transaction doesn’t the include the sale of existing shares of Airtel Africa, and the funds will be used by the telecom company to reduce its existing net debt, according to a filing.

The investment from QIA is part of the USD 1.25 Bn investment from Warburg Pincus, Temasek, Singtel and SoftBank Group International amongst others. The new investment will also help strengthen Airtel Africa’s consolidated books and help the U.K-based holding company of its operations cut its net debt to roughly USD 3.5 Bn.

The mobile phone operator, which is active in over 15 Africa countries, raised USD 1.25 Bn November last year, through a placement shares to six global investors in the runup to an Airtel Africa IP which is expected to hold in June this year – a medium through which the telecom looks to gather between USD 1.5 to USD 1.6 Bn. According to an unidentified insider, the follow-up fundraise is estimated to dilute Airtel’s stake in its Africa business to 67.24 percent from about 71.6 percent.

Bharti Airtel is on the thick of adversity as regards revenue and profitability in their India base due to vigorous competition by the entry of Reliance Jio Infocomm. To keep its head high in the game, the company is using all means possible to fund its 4G network expansion across the country. As a result, the telecom giant has been selling stakes in tower unit Bharti Infratel, while its plans to sell another 32 percent in the same company that was as at September valued close to USD 2,179,261,715

Airtel Africa is the second largest telecom company in the continent, with no less than 94 million subscribers and top-tier activities in most of its 15 markets. The recent developments come as a turnaround for the company, as it has been losing money in the previous years. As a matter of fact, it completed its first full profitability cycle March last year.