Bharti Airtel approves Rs 28,220 crore share swap to increase stake in Airtel Africa via ICIL deal

Bharti Airtel on Wednesday approved a preferential issue of up to 146.76 million equity shares to promoter-group entity Indian Continent Investment Limited (ICIL) as part of a strategic share swap transaction aimed at increasing its stake in Airtel Africa.

The transaction, valued at around Rs 282.2 billion, will allow Airtel to acquire up to 595.2 million shares, or a 16.31 per cent stake, in Airtel Africa from ICIL. Following the deal, Airtel will further consolidate its holding in the UK-listed telecom subsidiary, where it currently owns 62.73 per cent through its wholly owned arm Airtel Africa Mauritius Limited.

Shares issued at premium to market price

The board approved the issuance of shares at Rs 1,923 apiece, a price the company said is above the regulatory floor price prescribed under SEBI ICDR norms. The valuation is based on an independent registered valuer’s report certifying the swap ratio.

Bharti Airtel said the proposed equity shares would be issued at a premium of around 9.5 per cent to the last closing price prior to the relevant date. Meanwhile, the Airtel Africa shares being acquired under the transaction are valued at an 11.6 per cent discount to their last closing price.

Transaction seen as EPS accretive and leverage neutral

The telecom operator said the transaction is “cash-less and leverage neutral” and is expected to be earnings per share accretive, with incremental earnings from Airtel Africa outweighing the dilution arising from the preferential issue.

The company added that the move is in line with its strategy to strengthen ownership in a key overseas subsidiary operating across African markets.

Airtel Africa remains strategic growth engine

Airtel Africa, listed on the London Stock Exchange, operates telecom and mobile money businesses across multiple African countries. Bharti Airtel currently holds a 62.73 per cent stake in the company through Airtel Africa Mauritius Limited.

The company said the acquisition will be completed within timelines prescribed under SEBI ICDR Regulations, subject to shareholder approval at an extraordinary general meeting and other regulatory clearances. Airtel’s board has also authorised a special committee of directors to oversee and execute matters related to the transaction.