The sale reduces Singtel&rsquo s effective stake in Bharti Airtel to 27.5% from 28.3%

 

[SINGAPORE] Singtel has sold 0.8 per cent of its direct stake in Indian telecommunications company Bharti Airtel for about S$1.5 billion.

 

The local telco sold 51 million of its Airtel shares at 2,030 rupees (S$29.88) a share, through its indirect wholly owned subsidiary Pastel. The price reflects a 3.1 per cent discount to the closing price of Airtel&rsquo s shares on Thursday (Nov 6).

 

The share price was determined on an &ldquo arm&rsquo s length and willing-buyer, willing-seller basis&rdquo , said Singtel in a bourse filing on Friday. 

 

This is the second time this year that Singtel has reduced its stake in the Indian telecommunications company. In May, it sold about 1.2 per cent of its direct stake in Bharti Airtel. It also sold portions of its stake in Airtel in 2022 and 2024, raising a total of around S$3.5 billion from the progressive sales. 

 

Singtel said the latest transaction will result in an estimated gain of S$1.1 billion. It added that the transaction was executed via a private placement to institutional investors, reflecting strong demand.

 

Singtel&rsquo s effective stake in Bharti Airtel will fall to 27.5 per cent, from 28.3 per cent, following the completion of the sale. The group&rsquo s remaining stake in Airtel is valued at an estimated S$51 billion.

 

Arthur Lang, Singtel&rsquo s group chief financial officer, said the group has been working with Bharti Enterprises to &ldquo gradually equalise&rdquo its effective stake in Airtel over time.

 

&ldquo These transactions allow us to unlock value when appropriate, yet continue to retain a significant stake in Airtel and remain invested in India&rsquo s burgeoning digital economy,&rdquo he said.

 

This sale is part of Singtel&rsquo s ongoing capital management programme. Proceeds will also be used for capital returns, including its value realisation dividend and share buyback programmes, the statement read.

Lang added that the S$5.6 billion raised thus far is more than half its new mid-term asset recycling target of S$9 billion, and provides &ldquo financial flexibility to strengthen our balance sheet, fund growth opportunities in digital infrastructure and digital services&rdquo .

 

The settlement of the latest transaction is expected on Nov 10, according to a Bloomberg report, with a lock-up of 60 days. JPMorgan Chase is the sole broker. 

 

Shares of Bharti Airtel have rallied more than 30 per cent this year, making the company the third-biggest member of the benchmark Nifty 50 Index by market value. 

 

Separately, Singtel on Friday confirmed that it is in talks with global investment firm KKR & Co to fully own ST Telemedia Global Data Centres (STT GDC). However, it said &ldquo there is no certainty&rdquo that the discussions will lead to a definitive or binding agreement.

 

Bloomberg Intelligence reported after the announcement that proceeds from the sale could &ldquo help fund a larger stake in (STT GDC), as part of a consortium with KKR&rdquo , hence &ldquo reinforcing Singtel&rsquo s push to make AI (artificial intelligence)-ready data centres a core growth engine&rdquo .

 

Singtel&rsquo s &ldquo long-term growth momentum is powered by capital raised from asset recycling and digital expansion&rdquo , wrote Bloomberg Intelligence analyst Chris Muckensturm. 

 

Despite the recent reputational fallout from its Australian subsidiary Optus threatening to retail its turnaround efforts, &ldquo joint-venture synergies anchor Singtel&rsquo s brighter long-term outlook, with data-centre growth positioning the Digital InfraCo segment&rsquo s Ebitda (earnings before interest, tax, depreciation and amortisation) to double by fiscal 2028&rdquo , she said.

 

The Bloomberg Intelligence report added that one of Singtel&rsquo s many cash-raising options include a further paring of its stake in Bharti Airtel. 

 

A report from Maybank on Thursday said that Singtel&rsquo s associates were &ldquo advancing in the right direction&rdquo , and that the strong associate performance &ldquo far outweighs&rdquo the drag from the Optus outages. 

 

Despite its lower Airtel stake, analyst Hussaini Saifee estimated that Singtel&rsquo s key associate post-tax contribution will rise 22 per cent year on year in the second quarter of FY2026, outpacing their forecast of a 7 per cent year-on-year increase.