India’s largest telco Bharti Airtel (NSE:BHARTIARTL) has reportedly hired two bankers to sell its Sri Lanka and Bangladesh mobile operations as it seeks to focus on core operations and cut debt.
UAE telco Etisalat (ADX:Etisalat) and French incumbent Orange (EPA:ORA) are among the interested parties, according to local media reports. The bankers were not named.
New Delhi-based Airtel will also look at selling its tower businesses in the two countries, the reports stated, noting that the telco has about 2,500 towers in Sri Lanka and 4,000 in Bangladesh.
Responding to a request for clarification on the report from the Bombay Stock Exchange, Airtel said in a brief statement that it “keeps evaluating various opportunities on an ongoing basis in ordinary course of business and will make necessary disclosure as and when required”.
Airtel’s Sri Lankan unit is the smallest of five mobile network operators on the island, while the Bangladesh business is number four in a seven-player market.
Local reports in August 2013 said Airtel, then advised by Standard Chartered, was in advanced talks to sell Airtel Lanka to Etisalat, which owns the country’s third-largest mobile operator. Airtel Lanka had reportedly been valued at US$110m-US$130m. Earlier reports had stated that Malaysian telco Axiata, owner of Sri Lanka’s largest mobile operator Dialog, had approached Airtel about buying its Sri Lankan business.
Airtel, which reported net debt of US$10.7bn as of 30 June 2015, has made significant disposals recently. In July, the company announced that it had completed tower asset sales in five of its 13 African markets in transactions worth more than US$1.3bn. Shortly afterward, it agreed to sell its operations in four African markets – Burkina Faso, Chad, Congo Brazzaville and Sierra Leone – to Orange.
Later in the month, Orange, which also recently upped its stake in Morocco’s Meditel, said it is still “pursuing a policy of selective acquisitions by concentrating on markets in which it is already present”.
Orange does not have operations in Sri Lanka or Bangladesh, but has a presence in India via its Orange Business Services India (OBS India) division. This March, OBS India signed an interconnection agreement with Airtel, enabling their customers to collaborate on video meetings.
Airtel’s Sri Lanka and Bangladesh businesses generated combined revenues of Rs3.9bn (US$58.8m) in Q2 2015, down 11% year-on-year. They contributed to just 2% of Airtel’s total revenues. EBITDA for the two businesses was down 304% to Rs476m (US$7.2m).
