Mumbai, March 22: Bharti Airtel said the entire financing requirement of $8.3 billion for its proposed acquisition of Kuwaiti telecom firm Zain’s Africa operations has been successfully tied up. Bharti said the financing was oversubscribed, with major international banks committing to underwrite the total amount.
The acquisition is expected to be announced by March 25. The company said the amount tied up is a term facility, both in US dollar and Indian rupee with tenure just below five years. However, it declined to share the cost of the loan.
Bharti said for the $7.5-billion financing, the mandated lead arranger (MLA) and lead advisor is Standard Chartered Bank.
Barclays will be its MLA and joint lead advisor. The SBI Group is the MLA and lead onshore advisor. Other MLAs and co-advisors are ANZ, BNP, Bank of America Merrill Lynch, Credit Agricole CIB, DBS, HSBC, Bank of Tokyo Mitsubishi UFJ and Sumitomo Mitsui Banking Corporation.
In addition to the US dollar financing, SBI Group have committed up to $1 billion equivalent in Indian rupee to Bharti which would also cover any associated transaction costs.
Global investment house KSCC is serving as its regional financial advisor.
As reported by FE, the Bharti Airtel board had met on Saturday to discuss the financing plans. Sources said the company is now confident of concluding the deal by March 25, the day the two sides have set for concluding their exclusive talks.
In response to an FE query, the company’s spokesperson said, “While we cannot comment on the cost of the loan, we believe the financing is priced competitively, reflecting the credit profile and standing of Bharti Airtel and supportive market conditions”.
Once Bharti acquires Zain Africa, it would get access to 42 million new subscribers spread over 15 African countries.
Bharti had valued Zain Africa at $10.7 billion but after deducting the company’s net debt of $1.7 billion, had said that its total payout would be $9 billion (around Rs 44,000 crore). The two sides have agreed that of the $9 billion, $700 million would be payable a year after the deal is announced, thus the immediate payout from Bharti’s end would be $8.3 billion.
—–Agencies