New Delhi, May 7, 2001 : Bharti Enterprises Ltd., India’s leading telecom service provider, today announced that it has received additional equity investment of US $ 460 million from its global partners to support the continued and rapid development of its telecom projects in India. The company has attracted individual investments of US $ 200 million each from Singapore Telecom (SingTel), Asia’s leading providers of domestic, international and mobile telecommunications, and Warburg Pincus, one of the world’s largest private equity investors.
Other key investors in the current financing in Bharti include Asian Infrastructure Funds Management Ltd. with an investment of upto US $ 35 million, International Finance Corporation with an investment of US $ 20 million and New York Life with an investment of US $ 5 million. The funds raised will be deployed in line with the company’s strategic growth plans to establish new mobile telecom ventures, develop projects comprising NLDO (National Long Distance Operations), fund synergistic acquisitions and expand the company’s services.
These new investments by leading global companies indicate their commitment towards the Indian telecom industry and the NTP ‘99. It reinforces their faith in Bharti Enterprises’ vision to be one of the leading telecom service providers in the country, play a vital role in building the country’s telecom infrastructure and create outstanding value for the company’s stakeholders.
Bharti Enterprises has already invested about US $ 600 million in their existing telecom ventures. In addition, the company has also assigned over US $1 billion towards new projects across all segments of the telecom sector in India.
The current equity capital gives Bharti a strong net worth, which it can comfortably leverage to raise debt for its balance requirements. The company also plans to make an IPO to raise an additional US $ 200 million at an appropriate time in the future.
The size of capital commitments, the nature of projects under implementation and planned, demonstrate the confidence that Bharti Enterprises and leading international investors have in India, its telecom sector and the NTP ‘99.
This investment has further critical importance as it symbolizes the faith Bharti’s partners have in Bharti’s ability to build shareholder value by increasing their stake and level of investments they have previously made in Bharti.
Chairman and Group Managing Director of Bharti Enterprises, Mr. Sunil Bharti Mittal said, “Today we extend our relationships which have been truly valuable to us. It is a humbling experience to have partners who not only stand by you and trust you, but also are willing to share Bharti’s dream and vision. This investment is more than just resources for the group to realise its vision. It is a reflection of the faith and trust that our partners vest in us, in Indian telecom and the framework of telecom in India as embedded in the spirit of NTP ‘99"
Speaking on SingTel’s latest investment in Bharti, SingTel’s President and CEO, Lee Hsien Yang said: “Nine months ago, SingTel chose Bharti as its partner in India because we were impressed with the vanguard role the group had played in the development of Indian telecommunications. Bharti has made much progress since then and we are pleased to be increasing our investment in the group. We strongly support Bharti’s goal to become a leading integrated telecommunications player in India.”
According to Mr. Dalip Pathak, Managing Director, E M Warburg Pincus, "India continues to be a very important investment destination for Warburg Pincus in Asia. We have always been impressed by the dynamism and vision displayed by the Bharti Group and we are confident that the company will continue to rapidly strengthen its position as an outstanding high quality telecom service provider within the country. Our investment visibly demonstrates our faith in the company and the telecom sector in India".
SingTel is Asia's leading communications company with a comprehensive portfolio of services that include voice and data services over fixed, wireless and Internet platforms. Serving both the corporate and residential markets, SingTel is committed to bringing the best of global communications to its customers in the Asia Pacific and beyond. It has built the infrastructure that has helped transform Singapore into a global hub and is today the country's largest company in terms of market capitalization.
The SingTel Group is expanding rapidly into overseas markets, with current investments of more than S$5 billion (US$2.9 billion) in over 20 countries and territories. Besides the Bharti Group, its major investments include Belgacom of Belgium, Advanced Info Service of Thailand, New Century Infocomm of Taiwan and Globe Telecom of the Philippines. With a heritage of over 120 years, SingTel aims to be the Asian partner of choice for telecommunications operators across the world.
Together with Bharti, SingTel has formed a joint venture, Network i2i, to implement and administer India’s first submarine fibre-optic cable. The i2i cable network is a self-healing 10,800 km-long ring network that links Singapore, Chennai and Mumbai. Bharti Aquanet Ltd., a 51:49 per cent joint venture between Bharti and SingTel will manage and operate the cable stations in India.
More information can be found at http://www.singtel.com/ and http://www.i2icn.com/.
About Warburg Pincus
Over the last 30 years, Warburg Pincus has become one of the leading private equity and venture capital firms in the world. The firm’s experience is unparalleled in building successful businesses. Working in partnership with management teams, Warburg Pincus takes an active role in building businesses. The firm operates globally to source new investment opportunities, provide strategic advice and guidance, and fund the growth of attractive opportunities, Since its inception, Warburg Pincus’ strategy has been to :
* Develop broad investment capabilities internally
* Create a network of talented and experienced business people
around the world.
* Provide superior rates to return for its limited partners over the long
The firm has a massed significant experience in many different industries and around the world. It has invested over US $ 11 billion in over 400 companies in 29 countries, providing equity capital across the life cycle of the enterprise, from start-up through growth financings and including acquisitions and restructurings. Warburg Pincus operates from 8 offices in 7 countries covering the United States, Europe, Asia and Latin America.
With the proposed investment, Warburg Pincus will have invested approximately US $ 530 million in India making the country, the firm’s premier investment destination in Asia.
The investment in Bharti Enterprises of approx. US $ 300 million, is the second highest investment ever made by Warburg Pincus in any company, anywhere in the world.
About AIF Funds Management Limited (AIFML)
AIFML manages close to US$1 billion in direct investments across Asia. Its US$780 million Asian Infrastructure Fund (AIF) was established in 1994 with commitments from Frank Russell, International Finance Corporation, Asian Development Bank and the Quantum Group of Funds. Its other constituents include pension funds (e.g. IMF, Lucent Technologies, United Technologies, AT&T), banking and insurance companies (e.g. Chuo Mitsui, AMP) and governments (e.g. Sultanate of Oman, Brunei State Investment Agency, Kuwait Investment Agency) amongst several others. In addition to investments in the power and transportation sectors, AIF has nearly US$400 million invested in various telecom projects in Asia including wireless, fixed and wholesale carriers. AIFML also manages Russell AIF Asia II, as well as other discretionary funds.
The funds’ philosophy is to engage in strategic partnerships as a minority financial partner with leading local and international investors with the aim of developing businesses into listed companies. AIFML is focused on opportunities where in addition to equity contribution, it can add significant value by providing financial advice, bring in additional risk capital and introduce network partners amongst its portfolio companies.
About International Finance Corporation
The International Finance Corporation (IFC), a member of the World Bank Group, shares the primary objective of all Bank Group institutions: to improve the quality of the lives of people in its developing member countries. Today IFC is the largest multilateral source of loan and equity financing for private sector projects in the developing world. IFC finances and provides advice for private sector ventures and projects in developing countries in partnership with private investors and, through its advisory work, helps governments create conditions that stimulate the flow of both domestic and foreign private savings and investment. Its particular focus is to promote economic development by encouraging the growth of productive enterprise and efficient capital markets in its member countries.
IFC participates in an investment only when it can make a special contribution that complements the role of market operators. It also plays a catalytic role, stimulating and mobilizing private investment in the developing world by demonstrating that investments there can be profitable. Since its founding in 1956, and as at June 30, 1999, IFC has committed more than $26.7 billion in financing for its own account and has arranged $17.9 billion in syndications and underwriting for 2,264 companies in 132 developing countries. IFC coordinates its activities with the other institutions in the World Bank Group.
About New York Life
New York Life Insurance Company, a Fortune 100 company, is one of the largest insurance companies in the United States and the world. Founded in 1845 and headquartered in New York City, New York Life and its affiliates offer traditional life insurance, annuities and long term care insurance. Through New York Life Investment Management, New York Life's affiliates provide institutional asset management and trust services and an array of securities products and services such as institutional and retail mutual funds, including 401(k) products.
About Bharti Enterprises
Bharti Enterprises, India's leading telecom conglomerate, has been at the forefront of technology and has revolutionised telecommunications with its world-class products and services. Established in 1976, Bharti has been a pioneering force in the telecom sector with many firsts and innovations to its credit. Bharti has many joint ventures with telecom leaders like SingTel, Singapore; British Telecom, UK; .Warburg Pincus, USA; Telia, Sweden, Asian Infrastructure Fund, Mauritius, International Finance Corporation, USA and New York Life International, USA.
Bharti has many firsts to its credit, ranging from being the first cellular service in Delhi, first private basic telephone service provider in the country, first Indian company to provide comprehensive telecom services outside India (Seychelles), fastest growing VSAT company in India, and first multinational Internet Service Provider. AirTel, the premier cellular service from Bharti in Delhi, Himachal, Andhra Pradesh and Karnataka, has defined the cellular business through continuous marketing and technological innovations, consistently setting the benchmark for the Indian cellular industry. AirTel has the unique distinction of having been named India’s best cellular service for four years in a row by receiving the Techies ‘97, Techies ’98, Techies ’99 and Techies 2000. Today, Bharti is India’s largest telecom services company in the private sector.
Bharti Telenet created history with the launch of the first private sector fixed line service in the state of Madhya Pradesh, which is today India's largest private basic telephone service.
Bharti Enterprises also manufactures and exports telephone terminals and cordless phones. Apart from being the largest manufacturer of telephone instruments, it is also the first company to export its products to the USA.
Bharti Enterprises is today recognized as a true infrastructure builder of the nation. Amongst it’s series of rewards & recognitions, Bharti was recently awarded the first National Infrastructure Development Finance Corporation (IDFC) award for “Excellence in Infrastructure - 2000”.