Singapore's Singtel has sold an 0.8 percent stake in Indian telco Bharti Airtel for S$950 million ($710m) to US-based investment firm GQG Partners.
In a statement, Singtel said it will use the funds to invest in data centers and IT services.
The sale reduces Singtel's stake in Airtel from 29.8 percent to 29 percent.
Singtel previously sold a 3.3 percent stake in Airtel two years ago worth S$2.54 billion ($1.90bn). The company has been an investor in the Indian telco for more than 20 years.
In April, Singtel announced a reorganization to carve out its infrastructure assets.
The company revealed it will form a standalone infrastructure unit currently called Digital InfraCo to include the group’s regional data center business, subsea cable, and satellite carrier businesses as well as Paragon, Singtel’s platform for 5G MEC and cloud orchestration.
It was part of Singtel’s 2021 ‘strategic reset’ and ongoing efforts to restructure and reposition the company for growth.
Through this strategy, the company stated that it has been able to reduce net debt by S$3.2 billion ($2.4bn) as of September 2023.
"The group is now in an even stronger position to execute our disciplined capital approach of balancing investing for greater growth and delivering strong, sustainable returns for our shareholders," said Arthur Lang, Singtel Group CFO.
"Last November, we raised our dividend policy to between 70 percent and 90 percent of underlying net profit and are on track to pay at the upper end of that range this financial year, barring any unforeseen circumstances. We will look at actions to improve total shareholder returns via sustainably growing dividends and share price appreciation. We believe the current share price does not reflect the intrinsic value or growth potential of the group.”
Singtel currently provides 60MW of data center capacity in Singapore. The company has a portfolio of around 10 data centers across Singapore, Australia, and Hong Kong.
The telco broke ground on its DC Tuas facility in August, with the 58MW data center due to go live in 2025.
