Company had initially planned to sell 10% stake but strong investor demand made it nearly double the sale size. Image Credit: Shutterstock

Mumbai: Vodafone Group has sold a bigger-than-planned 18 per cent stake in India's Indus Towers, raising $1.82 billion that will serve to reduce its debt, the British telecom group said on Wednesday.

Bharti Airtel, India's no. 2 telecom company, said it bought about 1 per cent of Indus shares in the transaction, bringing its stake in the mobile tower operator to around 49 per cent.

Vodafone, which owned 21.5 per cent of Indus prior to the sale, had initially planned to sell a 10 per cent stake but strong investor demand made it nearly double the sale size, according to a banking source familiar with the matter who requested anonymity because the person was not authorised to speak to the media.

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Vodafone said it sold 484.7 million Indus shares at 310-341 rupees per share, raising 153 billion rupees, or 1.7 billion euros, in gross proceeds that it will use to repay debt.

The group said it had bank borrowings of 1.8 billion euros against its Indian assets, which also include a stake in Vodafone Idea, the country's debt-saddled No.3 telecom operator by subscribers.

Indus shares closed down 3 per cent, after sliding as much as 9.6 per cent in its busiest session ever.

Besides Airtel, SBI Mutual Fund and Kotak Securities were also among buyers of Indus' shares, exchange data showed.

Vodafone Group now has a 3.1 per cent stake in Indus. Vodafone Idea also has a stake in Indus. Private equity giant KKR and Canadian fund CPPIB sold their entire stakes in February.

Vodafone Group sold its stake via so-called block deals, where investors sell shares in the market. They have risen in popularity in India with the stock market trading at record-high levels.

Vodafone Idea shares ended 0.4 per cent higher, while Bharti Airtel's shares closed down 2.5 per cent.