Warburg Pincus to acquire 20% in Airtel's DTH arm

Bengaluru, dhns: Global private equity firm Warburg Pincus' affiliate will be acquiring 20% stake in country's largest telecom provider, Bharti Airtel's direct-to-home (DTH) business, Bharti Telemedia for $350 million.

Of the stake sold, 15% will be sold by Bharti Airtel and the balance by another Bharti entity which holds 5% stake. Upon closing of the transaction, Airtel will own an 80% equity stake in Bharti Telemedia Limited.

Airtel's board has approved the transaction, which is subject to regulatory approvals. As part of the transaction, Viraj Sawhney, Managing Director, Warburg Pincus India, will join the board of Bharti Telemedia.

Bharti Telemedia had approximately 14 million subscribers and approximately $550 million in revenues during the 12-month period ended September 30, 2017.

Airtel TV, which was launched in 2008, has grown to become a top three in-home entertainment player. The company has over 1,500 partners and over 158,000 recharge outlets in approximately 630 districts of the country.

Gopal Vittal, MD and CEO (India and South Asia), Bharti Airtel, said, "Airtel has enjoyed a very successful partnership with Warburg Pincus in the past and we are excited to partner with them once again in an attractive and fast growing space. Airtel TV is very well positioned in the DTH space, and we are committed to grow our share of the market through a combination of innovation, value engineering, customer service and distribution initiatives."

Experts see it as part of restructuring the company, which has seen strain in its revenues post launch of Reliance Jio. Telcos have been queuing up for the exit from non-core businesses, with some even selling off the towers.

Vishal Mahadevia, Managing Director and Co-Head, Warburg Pincus India, said, "The Indian Digital TV market is expanding rapidly and we believe that Airtel DTH is well positioned to capitalise on incremental growth in digitisation and new TV penetration in Tier 3 and 4 towns and rural areas."

Warburg Pincus is a global private equity firm focused on growth investing. The firm has more than $44 billion in private equity assets under management. The firm's active portfolio of more than 150 companies is highly diversified by stage, sector and geography. Warburg Pincus is an experienced partner to management teams seeking to build durable companies with sustainable value.