Providence Equity-backed Idea Cellular to raise $616m through share sale

Existing investor Axiata Group, the Malaysian telecom operator, will cover INR7.5 billion of the offering, with the rest coming from institutional investors. The timing, pricing and exact quantum of equity shares to be issued are to be decided later.

Axiata currently holds a 19.9% stake in the company. It has controlling interests in mobile operators including Malaysia's Celcom, Indonesia's XL, Sri Lanka's Dialog, Robi in Bangladesh and Smart in Cambodia. as well as minority stakes in Singapore's M1 as well as India's Idea.

Providence owns a 9.96% stake in Idea. It acquired 14.6% for $400 million in 2006.

Idea Cellular hit an all-time high during morning trading on Friday, reaching INR176.40. The share price is up 101.9% on a one-year basis. Telecom shares previously hit highs last month when the Indian government relaxed foreign ownership rules, allowing overseas investors to take a 100% stake in telecom firms.

While Idea's revenues have been growing, the company still has a net debt of over INR100 billion.

Revenues were up 14.9% year-on-year to INR224.6 billion for 2011-2012, while net income improved 39.8% to INR10.1 billion. For the quarter ended June 2013, Idea reported a 24% jump in EBITDA to INR20.7 billion.

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• Topics
• South Asia
• Technology
• PIPEs
• India
• TMT
• Providence Equity Partners
• PIPE