The Telegraph
Since 1st March, 1999
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Bharti to shop for cash abroad

New Delhi, June 2: Bharti Tele-Ventures Limited (BTVL) plans to launch its maiden overseas float of around $ 200 million, probably an American Depository Receipt (ADR), next financial year even as it gets ready to acquire telecom circles to expand its footprint in India.

AirTel, the cellular brand of mobile services from Bharti Tele-Ventures, has rustled up 1 million subscribers in Delhi. It now plans to touch the 3.5 million customers in the country by the month-end and 10 million over the next few years, with Delhi seen as the major city to fuel the growth.

Bharti Enterprises chairman Sunil Bharti Mittal said: “We have started the internal activities for an overseas flotation and will decide on the other components like consultants and lead managers later this year. This will be more than the earlier domestic float.” Last year, Bharti Tele-Ventures listed the company on the Indian stock market with a $ 185-million issue.

Akhil Gupta, managing director (finance) at BTVL, said: “We are following all basic norms, like announcing our quarterly results regularly on the website and also through public announcements, for the ADR. We will closely watch developments world-wide before the final decision next financial year. The ADR will certainly be more than the domestic equity issue.”

Commenting on the acquisition plans of the company, Mittal said the decision will depend on the government’s policy on intra-circle acquisitions and the FDI policy in telecom.

“We are ready for acquisition to expand our footprint but cannot move ahead without a clear policy announcement from the government. The policy and the guidelines need to be spelt out. The company will prefer acquisitions of circles where we are already present,” said Mittal.

Asked how much money had been set aside by the company for snapping up other firms, Mittal said funds would never be the limiting factor in sealing deals. “We always have Rs 400-500 crore in cash with us. Moreover, banks and FIs are always keen to fund us.”

Asked about the potential circles for acquisitions, Mittal said small regional players should be interested in selling their stakes in the current financial year. “Clearly there will be consolidation this year,” he added.

The company has announced an investment of more than Rs 175 crore to enhance its mobile infrastructure in Delhi. The total investment in the capital alone will be Rs 1,950 crore by the end of this financial year.

AirTel Delhi will also set up its sixth mobile switching centre by August. It already has 415 cell sides in Delhi and plans to install another 35 by September.

In order to meet the demand of growing SMS, the company is planning to double exchange capacity in Delhi, and is planning to bring down the cost of messaging.

The company is confident that the current 75:25 ratio of pre-paid and post paid will be balanced with a resurgence of post-paid customers in majority of its telecom circles.

Mittal reckons that along with Mumbai, Shanghai and Beijing, Delhi has the potential to throw up 10 million mobile subscribers.

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