Bharti Airtel completes share sell in tower arm for Rs 3,325 crore; Infratel plunges by 4%

Key Highlights: 

• Bharti Airtel sells 83 million shares in tower arm
• Bharti Infratel tumbles by nearly 4% after share sale 
• Airtel now owns 53.51% stake in Infratel

Bharti Airtel on Tuesday made successful divestment of 83 million shares in it's subsidiary Bharti Infratel via it's another wholly-owned subsidiary Nettle Infrastructure Investments Limited. 

The transaction was done through a secondary share sale in the stock market. 

Share sale was carried for a total consideration of over Rs 3,325 crore ($ 510 million) and was executed at price band of Rs 400.6 per share - which is at a discount of 3.6% of the previous day closing price. 

With this movement, the share price of Bharti Infratel tumbled by nearly 4% on stock exchanges. At 1401 hours, the company's stock was trading at Rs 400.20 per piece down by Rs 11 or 2.65% on BSE. 

In a statement to exchanges, Bharti Airtel said, "The allocation was done to global investors, fund managers and long only funds, including many repeat investors. Led by healthy investor appetite, the deal was up-sized by over 25%."

Transaction does not fall with the purview of Related Party Transactions. 

Proceeds from this share sale will be utilized to reduce Bharti Airtel's total debt. 

Net debt of Bharti Airtel rose to Rs 91,480.1 crore as on September 2017 - compared to Rs 87,840.4 crore in June 2017 quarter and Rs 81,480.3 crore a year ago same period.

Now post transaction Bharti Airtel and its wholly owned subsidiaries together have an equity holding of 53.51% in Bharti Infratel.

Infratel's contribution in Bharti Airtel's over turnover stood at Rs 6,084.7 crore which would be 6.4% during the last fiscal year (FY17). Net worth of Infratel was at Rs 9,141.3 crore in FY17. 

Where Infratel share price saw selling pressure, Bharti Airtel's stock price remained positive trading at Rs 499.05 up 0.20% on BSE. In the early trade, Airtel's share price has gained over 1%.