Singapore wealth fund Temasek Holding has part-exited Bharti Infratel, the towers and other related infrastructure arm of Bharti Airtel, India’s largest mobile phone company, a report said.
The fund had invested around $500 million in the tower unit of Bharti Airtel in 2007, and was part of the consortium that had jointly bought 14% stake in Infratel for about $1.25 billion. The other investors were, Goldman Sachs Group Inc, the Investment Corp of Dubai, Macquarie Group Ltd, Citigroup, AIF Capital, and India Equity Partners.
A report in online portal VCCircle said Temasek sold shares of Bharti Infratel through an open market transaction, adding that this was Temasek’s second part-exit from Bharti Infratel after having selling some shares during the IPO two years ago.
“It has pulled out around $90 million, making gross internal rate of return (IRR) of a little over 4 % in rupee terms on its nearly seven-year-old investment last quarter. In dollar terms its part-exit has been at par, it is estimated,” the report added.
Even after its part-exit, the Singapore fund continues to hold a little over 2% equity stake, valued at around $200 million, in Bharti Infratel.
Prior to this Temasek had made a part exit in 2012 during Infratel’s listing. At that time, an arm of the Singapore wealth fund – Compassvale Investments – held about 5.17% in Bharti’s tower arm. Post the listing, which gave it a part-exit, its stake had come down to 3.18%.
Temasek is learnt to made this partial exit, where it had got $24 million, at a 25% cut on its US dollar investment.
KKR Towers Company, which held 2.59% prior to the IPO and 2.39% after the float, along with Millenium Mauritius and AIF Capital Telecom Infrastructure had also made part exits, while GS Strategic Investments, an arm of Goldman Sachs, which had held 1.03%, hedge fund Eton Park’s Anadale Ltd, which owned 1.03% and a unit of Japan’s Nomura that held 0.52% had made complete exits.
The Singapore Fund had recently invested $82 million for an undisclosed stake in Devyani International, the Indian operator of KFC, Pizza Hut and Costa Coffee chains.About a fifth of this investment was used to buyout ICICI Venture’s stake in Devyani. The restaurant operator has more than 300 outlets across India, Nepal and Nigeria.
Temasek Holdings along with L Capital and International Finance Corp (IFC) are in talks to pick up about 30% stake in India’s Aditya Birla Group for $400-500 million.