SingTel sells 0.8% stake in Bharti Airtel to GQG Partners for $711 million

This move is part of Southeast Asia’s largest telecom operator’s ongoing capital recycling efforts, marking a total of S$8 billion since its strategic reset in 2021.

Airtel and GQG Partners did not respond to queries, the report added.

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Details of the Transaction

SingTel’s unit, Pastel, sold 49 million shares, equivalent to 0.8 percent of Airtel’s outstanding shares. This transaction effectively reduces SingTel’s stake in the telecom operator by 0.8 percentage points, according to a statement released by the company.

Following the sale, SingTel will retain an effective stake of 29 percent in Airtel, valued at approximately S$33 billion.

This sale is part of a series of share sales by SingTel in Airtel, including a direct 3.3 percent stake sale for S$2.54 billion in 2022.

SingTel anticipates recording a gain of around S$700 million from this stake sale, without providing further details on the difference from the divestment price. SingTel’s finance chief, Arthur Lang, highlighted the Group’s disciplined capital approach, aiming to balance investment for greater growth and deliver sustainable returns to shareholders.

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Dividend Policy and Future Plans

The telecom group has increased its dividend policy to distribute between 70-90 percent of underlying net profit, with plans to pay dividends at the upper end of the range in fiscal 2024.

Lang expressed that the current share price of SingTel does not reflect the intrinsic value or growth potential of the Group.

As of now, SingTel shares are trading 0.4 percent higher at S$2.35 each, while Airtel shares are up 0.7 percent at ₹1,201.95 per share.

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Published: 07 Mar 2024, 12:58 PM IST