SingTel to invest Rs 1,800 cr, buys stake in AirTel cos

SingTel to invest Rs 1,800 cr, buys stake in AirTel cos
ENS ECONOMIC BUREAU

New Delhi, August 7: Singapore Telecom (SingTel) today announced a Rs 1,800 crore investment plan for the Indian telecom market by picking up equity stake in two companies of the Bharti group promoted by Sunil Mittal.

"The initial investment of Rs 1,800 crore would be for foray into domestic long distance communication, submarine cabling network joining Chennai with Singapore and for acquisition of other cellular companies in the country," Sunil Mittal, group managing director told reporters.

SingTel would pick up 20 per cent in Bharti Telecom and 15 per cent in Bharti Televentures, Mittal said adding that distribution of funds would be finalised soon depending upon the devolution of shares. The investment of Rs 1,800 crore by SingTel is the largest to date by a Singapore company in India and the third largest investment made by SingTel outside Singapore after those in Belgium and Thailand.

He said Bharti would also reach to other nations in the SAARC region in partnership with SingTel.

Speaking on the occasion, SingTel chief Lee Hsien Yang said the investment would made in the Indian market in the current financial year and added that there were plans to increase the investment in future also.

He, however, said that it was not an exclusive tie-up with the Bharti group. Mittal said all services offered by the group would continue to be under the brandname "AirTel".

Mittal said that the company would soon approach the Foreign Investment Promotion Board (FIPB) for seeking approval for diluting stake to SingTel. On the revised pattern of equity structure of the two group companies, Mittal said no final decision was taken yet but indicated that stake would be provided by issuing fresh capital in the group companies.

Bharti Enterprises has 96 per cent stake in Bharti Telecom with a paid-up capital of Rs 30 crore, while in Bharti Televentures (paid-up capital of Rs 86 crore) Telecom Italia of Italy and E M Warburg Pincus of USA have 20 and 19 per cent stake respectively.

Bharti Televenture is likely to be listed on the bourses this year and company's paid-up capital would go up to Rs 125 crore (face value), Mittal said adding that SingTel would be picking up stake through new shares. In Bharti Telecom, he said details would be finalised soon, Mittal said.