Citigroup May Drop Out Of Bharti Airtel Syndicate (C, BCS)
Citigroup (NYSE: C) is contemplating leaving the banker syndicate working for Bharti Airtel Ltd. The syndicate is responsible for arranging $8.5 billion in funding for Bharti’s acquisition of the African operations of Kuwait’s Mobile Telecommunications Co. According to the sources, Citi ( C) is not happy with the loan’s tight pricing. The telecom deal is India’s second largest acquisition ever.
The pricing for the loan syndication was tightened as bankers clamored to be part of the largest dollar-denominated loan in the Asia-Pacific region (excluding Japan). The loan pricing is set at 195 basis points above LIBOR. Even state-run firms generally obtain loans at 200-250 basis above LIBOR. Currently, the syndicate includes the State Bank of India, Standard Chartered Bank and Barclays Bank (NYSE: BCS). Both Citi and Bharti refused to comment.
