Warburg Pincus to buy 20% stake in Airtel DTH for Rs 2,310 crore

At a time when the entire DTH industry is facing the heat of internet serge in the country that has resulted in the sector's consolidation, Bharti Airtel on Tuesday announced that an affiliate of global private equity company Warburg Pincus will buy up to 20 per cent stake in its direct-to-home (DTH) arm Bharti Telemedia for Rs 2,310 crore. Bharti Telemedia is not the only DHT major to sell stake. In November, Reliance Big TV was sold to Pantel Technologies and Veecon Media and Television. Another major player Dish TV had also announced last year that it would merge with Videocon d2h to form a unified company Dish TV Videocon Ltd. Of total 20 per cent stake, Bharti Airtel will sell 15 per cent stake of the DTH subsidiary, while Bharti's another entity would sell the rest of 5 per cent stake.

"Bharti Airtel...and Warburg Pincus, a global private equity firm focused on growth investing, today announced that an affiliate of Warburg Pincus will acquire up to a 20 per cent equity stake in Bharti Telemedia Limited, the DTH arm of Airtel, for approximately USD 350 million," both the companies said in a joint statement. Upon closing of the transaction, Airtel will own 80 per cent equity stake in Bharti Telemedia Limited.

"Airtel has enjoyed a very successful partnership with Warburg Pincus in the past and we are excited to partner with them once again in an attractive and fast growing space," Bharti Airtel MD & CEO (India & South Asia) Gopal Vittal said. Bharti Telemedia had approximately 14 million subscribers and approximately USD 550 million in revenues during the 12- month period ended September 30, 2017. The company claims to have strong distribution infrastructure, with over 1,500 partners and over 1,58,000 recharge outlets in approximately 630 districts of the country.

"The Indian Digital TV market is expanding rapidly and we believe that Airtel DTH is well positioned to capitalise on incremental growth in digitisation and new TV penetration in Tier 3 and 4 towns and rural areas," Warburg Pincus India, Managing Director and Co-Head, Vishal Mahadevia said. The Airtel board has approved the transaction, which is subject to regulatory approvals, the statement said. As part of the transaction, Viraj Sawhney, Managing Director, Warburg Pincus India, will join the board of Bharti Telemedia Limited, it added.

With PTI inputs