Bharti Airtel shares rose nearly 2 per cent on Tuesday after the mobile carrier announced that is selling over 4,800 phone towers in Nigeria to American Tower Corp for $1.05 billion. Nigeria is Bharti Airtel's biggest market in Africa.
This is the third and largest tower sale by Bharti Airtel this year. In September, the company had agreed to sell more than 3,500 towers in six African nations to Eaton Towers for around $800 million. In July, Bharti Airtel agreed to sell about 3,100 masts in four African countries to Helios Towers Africa, a George Soros-backed company.
These deals are aimed to cut costs and pare debt, analysts say. Bharti Airtel entered Africa in 2010 by acquiring loss-making telecoms operations for $9 billion, funded by debt. It is yet to turn a profit in Africa because the high cost of running the operations eats into margins. The company had a debt of around $10 billion as of September 30.
Mobile operators in Africa such as Bharti Airtel have been selling masts to specialist tower firms and leasing them back to cut maintenance costs on a continent with poor access to electricity and shoddy roads.
The companies expect to close the deal during the first half of 2015, they said.
Mayuresh Joshi of Angel Broking told NDTV that most positives are factored in, so there isn't much headroom for the stock to go up. However, long term investors should accumulate the stock because the company is looking to deleverage, he added.
Bharti Airtel was the top Nifty gainer in morning trade. As if 09.21 a.m., the stock traded 1.4 per cent higher at Rs 405.10 and outperformed the broader Nifty, which traded 0.1 per cent lower.
(With inputs from Reuters)
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