Mumbai, February 3, 2002: Bharti Tele-Ventures Limited (BTVL), successfully closed India’s first 100 per cent book-building Initial Public Offering (IPO) on Saturday February 2, 2002. The Issue had opened on January 28, 2002 for a total of 18.5 crore equity shares representing 10% of the post issue capital of the company.
The Book has been oversubscribed over 2.5 times. The demand was built at higher than the floor price of Rs. 45 per share largely between Rs. 46 – Rs. 48 per share. The company in the interest of all the investors has decided to fix the issue price at Rs. 45 per share in consultation with the book running lead managers, JM Morgan Stanley and DSP Merrill Lynch.
The total demand at a price of Rs. 47/- per share was at 25.91crore shares, while the demand at Rs. 46/- per share was 39.88 crore shares against an issue size of 18.53 crore shares. The issue received over 25,000 applications.
JM Morgan Stanley and DSP Merrill Lynch, the book running lead managers to the offer also said: India’s first 100 per cent book built Bharti Tele-Ventures IPO has been a great success and has received a very good response across categories. They further added that they were pleased to note that inspite of the fact that the book was fully built at Rs. 47 per share the company had decided to fix the price at Rs. 45 per share in the interest of investors.
While the total demand received under the book has been Rs. 2137.5 crore, the amount retained by the company at the issue price of Rs. 45 per share is Rs. 833.85 crore. After the final allocation of shares, the foreign ownership of the company has gone upto 46.7% leaving a clear gap of 2.3 % for secondary market trading.
Among many of the firsts associated with this Initial Public Offer, this offer has been successfully completed under the newly allowed 100% book building guidelines of SEBI and the entire bidding process was completed online and in a transparent manner on the NSE and BSE terminals of the syndicate members. This success also clearly recognises the true potential of the Indian telecom market.
Mr Sunil Bharti Mittal, Chairman and Group Managing Director, Bharti said: “The excellent response is a reflection of the investor’s confidence in Bharti and the huge potential of the Indian Telecom market. We are pleased to have received an excellent response in a challenging market environment. The overwhelming response from foreign investors reinforces their confidence in Bharti and India as an attractive investment destination.”
Mr Nimesh Kampani, Chairman, JM Morgan Stanley, the book running lead manager to Bharti Tele-Ventures IPO said: “The success of Bharti Tele-Ventures domestic IPO will open the gates for the primary capital markets in India and boost investor confidence.”
Mr Hemendra Kothari, Chairman, DSP Merrill Lynch, the book running lead manager to Bharti Tele-Ventures IPO said, “The blend of the strong fundamentals and attractive valuation has contributed to the success of the Bharti Tele-Ventures IPO. The success of this IPO will allow other fundamentally strong companies to raise capital from the markets.
About Bharti Tele-Ventures
Bharti Tele-Ventures, a company promoted by Bharti Telecom, is India’s leading private sector provider of telecommunications services based on an aggregate of approximately 1,340,000 customers as of November 30, 2001, consisting of approximately 1,048,000 cellular, 135,000 fixed-line and 157,000 Internet customers. Cellular services currently constitute the largest portion of its business in terms of total revenues. The company also provides fixed-line, VSAT, Internet and network solutions and has also commenced offering national long distance services by offering data transmission services and voice transmission services for cellular to cellular calls. The Company intends to offer voice transmission services for fixed-line subscribers shortly. Bharti Tele-Ventures intends to widen its range of telecommunications services to provide international bandwidth access and international voice services. The company seeks to capitalise on the growth opportunities that it believes is available in the Indian telecommunications market and consolidate its position to be the leading integrated telecommunications services provider in key markets in India, with a focus on providing cellular services.
Bharti Tele-Ventures is a holding company and its operations are segmented into four divisions, operated by wholly owned subsidiaries: Cellular - Bharti Cellular, Access - Bharti Telenet, Long Distance - Bharti Telesonic, Broadband Solutions -Bharti Broadband Networks.
Bharti Tele-Ventures presently offers cellular services in six of the 22 circles in India and intends to provide cellular services in nine additional circles, for which the Company has entered into licenses with the DoT. As of November 30, 2001, approximately 92% of India’s total number of cellular subscribers resided in their existing and proposed cellular circles, according to COAI reports.
Bharti Tele-Ventures was the first private sector operator to provide fixed-line services in India. It currently provides fixed-line services in the Madhya Pradesh circle, and Haryana circle and intends to provide fixed-line services in three additional circles of Delhi, Karnataka and Tamil Nadu, for which they have entered into licenses with the DoT.
Bharti Tele-ventures has always believed in creating strong partnerships with its joint venture partners. Today SingTel and Warburg Pincus are it’s leading partners. The other partners include leading international financial investors such as International Finance Corporation, Asian Infrastructure Fund Group and New York Life Insurance.
Note: This press release is not for distribution in the United States. This press release is not an offer of securities for sale in the United States and securities may not be offered or sold in the United States absent registration under the US Securities Act of 1933 or an exemption from such registration.