Bharti Airtel is planning to mobilize funds up to $1 billion or about Rs 7,000 crore via a bond issue by its subsidiary Network i2i.
Airtel aims to use the proceeds to reduce debt. Network i2i is a direct 100 percent subsidiary of Bharti Airtel.

Bharti Airtel said in a regulatory filing the offering of USD denominated Guaranteed Subordinated Perpetual Securities by Network i2i expected to be rated BB by both S&P and Fitch may follow, subject to market conditions.

Airtel has appointed bankers including BofA Merrill Lynch, Barclays, BNP Paribas, Citigroup, HSBC, J P Morgan and Standard Chartered Bank as joint book-runners and joint lead managers to organise a series of fixed income investor meetings and calls across Asia, Europe and the US starting Wednesday.

The fundraising is likely to be in range of $750 million to $1 billion, and the final figure will be arrived at based on the market response, PTI reported.

The proceeds from the issue will be utilised to reduce debt of Bharti Airtel. Bharti Airtel’s debt stood at Rs 1.16 lakh crore as in June 2019.

S&P Global Ratings said it expects Bharti Airtel’s leverage to remain elevated over the next six to nine months, but improve gradually due to reduced capital spending and increasing stability in its India mobile operations.

“We assess Network i2i’s proposed $1 billion subordinated perpetual securities (PERPS) as having intermediate equity content. The PERPS are guaranteed by Bharti Airtel. We estimate the issuance will improve the telecoms operator’s FFO-to-debt ratio (funds from operations to debt ratio) by about 50 basis points,” S&P Global Ratings said.