Bharti Airtel selling shares in tower unit

Bharti Airtel, country's biggest mobile phone operator by users, is raising as much as $415 million through the sale of shares in its mobile tower unit Bharti Infratel, two sources directly involved in the process told Reuters.

Bharti Airtel, which operates in 20 countries across Asia and Africa, is likely to use the proceeds for funding next month's auction for mobile phone airwaves, brokerage analysts tracking the telecoms sector said.

Reliance Industries and seven other firms including Bharti Airtel and Vodafone Group Plc's India unit have applied to participate in the auction.

"Funds would be used for spectrum auction bids by Bharti Airtel, as it would require more money. The company may not want further debt on the books," said Deven Choksey, managing director at brokerage KR Choksey Securities.

Bharti Airtel, headed by billionaire Sunil Mittal, and around a third owned by Singapore Telecommunications, had net debt of nearly $11 billion as of December end.

Bharti Airtel is selling Bharti Infratel's shares at an indicative price band of Rs 350-360 a share, the sources said, a discount of as much as 6 per cent from its Wednesday's close price of Rs 372.30.

The size of the offering is $315 million, with an option to raise it by another $100 million, said the sources, who declined to be named as the details of the offering were not public yet.

Bank of America Merrill Lynch and UBS are the bankers to the issue, said the sources. Spokesmen at Bharti Airtel and its unit Bharti Infratel did not respond to requests for comment.

The latest issue comes amid a revival in share offerings in the Indian market after a tepid 2014.

HDFC Bank, the most-valuable lender in India, this month raised $1.6 billion from stock sales in the United States and India to boost capital ahead of an expected pick up in economic growth that will boost credit demand.

(Additional reporting by Aman Shah)

(Reuters)