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Thursday, March 7, 2013

Airtel eyes 1.6k cr from 25% stake sale in DTH biz

New Delhi: Bharti Airtel is looking to sell 20-25% stake in its direct-to-home business to a clutch of private equity players, a move that will help it raise $250-300 million (up to Rs 1,650 crore). 

    Based on the deal size, the third largest DTH operator in the country would be valued at close to $1.2 billion. Although half-a-dozen players are said to be in the fray to buy the Bharti Airtel stake, the company did not comment terming it "market speculation". 
    With nearly 8 million customers at the end of December, Bharti Airtel's DTH operations were the third largest after Zee's Dish TV and TataSky. The
sale to private equity players comes at a time when rivals such as Videocon and Tata Sky are looking to tap the market to raise funds through initial public offers. The rush for funds is aimed at growing in scale as the government and the regulator look to digitize the business. 
    DTH services account 
for just around 3% of Bharti Airtel's revenue with telecom being the mainstay. It, however, completes the internet, communications and entertainment loop for the group that ventured into the business in late 2008. 
    For the quarter-ended December, Bharti Airtel said that its Digital TV service had revenues of Rs 428 crore while earnings before interest and taxes were estimated at Rs 182 crore. 
    Cumulative investments in the business are estimated to be close to Rs 4,000 crore till the end of December 2012. The move comes after the government last year increased the foreign direct investment limit in DTH and digital cable companies to 74%.

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