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Highlights
- Bharti Airtel, the second-largest telecom operator, will soon be swapping its shares with ICIL (Indian Continent Investment Limited) for Airtel Africa.
- This is a part of corporate restructuring under Bharti Enterprises.
- It is to consolidate control over the subsidiary Airtel Africa.
Andrew Bonwick
Vice President of Product Development at Relm Insurance
Madhav Sheth
CEO of Ai+ Smartphone
Stephen Rose
CEO Render Networks
Bharti Airtel, the second-largest telecom operator, will soon be swapping its shares with ICIL (Indian Continent Investment Limited) for Airtel Africa. This is a part of corporate restructuring under Bharti Enterprises. It is to consolidate control over the subsidiary Airtel Africa. The deal is worth Rs 28,220 crore. This is a share swap deal, which means that there is no cash involved at all.
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What is Changing for Airtel and ICIL and Airtel Africa?
Bharti Airtel has decided to give 2.3% out of its stake to ICIL, and against that, Airtel will get 16.31% stake in Airtel Africa. Airtel will issue 146.7 million new shares at Rs 1923 a piece for ICIL, representing a 9.5% premium to the previous closing price (May 13). ICIL’s entire stake of about 595.2 million shares (16.31%) in Airtel Africa will be transferred to Airtel in this share swap deal.
This will take Bharti Airtel’s shareholding in Airtel Africa to 79.04% from the previous 62.73%. At the same time, ICIL will increase its stake in Bharti Airtel from 0.95% to 3.25%.
Airtel is Getting Airtel Africa at a Discount, ICIL is Getting Airtel at Premium
Bharti Airtel is giving away the 146.7 million new shares to ICIL at a premium of 9.5% from the previous closing price. At the same time, ICIL is giving Airtel Africa shares to Airtel at a discount of 11.6%. ICIL is getting the shares of Airtel at a premium, while Airtel is getting Airtel Africa at a discount. This creates a winning scneario for the Bharti Group.
