Airtel Africa plc has announced the repayment of $550m by its subsidiary, Bharti Airtel International (Netherlands) B.V., representing 5.35 percent of a bond issued under a Guaranteed Senior Notes maturing on 20 May 2024.
The leading provider of telecommunications and mobile money services across Africa, in notification to the Nigerian Exchange Limited on Monday said the repayment is a continuation of its strategy to reduce external foreign currency debt.
The notification signed by Airtel Africa’s Group Company Secretary, Simon O’Hara, reads in part, “Airtel Africa confirms that its subsidiary, Bharti Airtel International (Netherlands) B.V., has repaid in full the 5.35% Guaranteed Senior Notes maturing on 20 May 2024. This bond repayment of $550m has been made exclusively out of cash reserves at the holding company (HoldCo) and is a continuation of its strategy to reduce external foreign currency debt.”
Explaining the details of the transition further, it states, “At the time of the IPO in June 2019, the Group had $2,719m of external debt at HoldCo which resulted in significant exposure to currency fluctuations and the reliance on up streaming funds to cover both interest costs and the principal repayment.
“Through a consistent execution of its strategy supporting strong free cash flow generation, and continued up streaming success, the Group has been reducing Holdco debt over the past few years and has now reached the significant milestone of a zero-debt position at HoldCo.
“The current leverage and capital structure is a reflection of the Group’s successful capital allocation strategy that has been in place since our IPO, and it will aim to continue reducing foreign currency debt obligations across its OpCo’s.”