Airtel Africa Plc has recalled $505 million bonds and sold off telecommunication towers in Malawi, Madagascar and Tanzania for a total consideration of $284 million as part of measures to pay off close to $3 billion debt.
By recalling a bond, a firm pays off the principal amount and the interest of a debt instrument before the due or maturity date. This occurs where the issuer (borrower) intends to clear the debt from its books and save on the regular interest payments.
Airtel Africa redeemed the bonds that were to mature in March 2023, saving $26 million on interest payments from the early redemption.
Following the early repayment of the bonds priced at 5.125%, the Group now has only $1 billion of bonds remaining at Holding Company level that are due in May 2024.
The Group which has 128.4 million customers is looking to sell more shares to the public through an IPO in three years and sell more telecommunication towers in Chad and Gabon. In March 2021, the Group announced memorandum of understanding arrangements with Helios Towers for the potential sale of its tower assets in Chad and Gabon.
The Group has already completed the sale of more than 2,600 telecommunication towers in Tanzania, Madagascar and Malawi generating total proceeds of $284 million which were used to partly reduce its debt to $2.9 billion from $3.5 billion.