Third Bharti payout for Warburg Pincus

The New York-based global private equity firm has sold a third tranche of shares in listed Indian telecom company Bharti Tele-Ventures as part of an increasingly lucrative deal.

Warburg Pincus has sold its third tranche of shares in Bharti Tele-Ventures in the last seven months. A six percent stake has been sold to an unnamed buyer for about $561 million (€419 million), according to sources.

This is the third time Warburg Pincus has taken advantage of strong investor demand for the company’s stock. In August 2004, it realised a 3.35 percent interest for $208 million, and then last month divested a further 3.2 percent for $306 million.

Warburg Pincus originally acquired an 18.5 percent stake in the company prior to its IPO on the Bombay Stock Exchange in January 2002, paying $300 million. The firm, which has already received back $1.1 billion, still retains a holding of around six percent following the latest transaction.

In a recent article in sister publication Private Equity International, Warburg Pincus managing director Dalip Pathak described the Bharti deal as “a success story for both Warburg Pincus and Indian private equity as a whole – it demonstrates that returns from India can be as good as anywhere else in the world.”

Bharti, which is 28 percent-owned by Singapore Telecommunications, has seen it valuation increase sevenfold since going public. Based in New Delhi, the firm is expected to more than double its full-year tax profit to around 13.5 billion rupees ($308 million) against a background of surging mobile phone sales in India.