The Singapore government’s investment arm GIC Pvt Ltd will invest Rs5000 crore ($700 million) to pick up around 4% stake in Bharti Airtel by subscribing to the telco’s Rs25,000 crore rights issue. That’s by way of a portion of the stock entitlement of promoter group entity Bharti Telecom.

“Singtel and Airtel’s major shareholders, Bharti Group and Bharti Telecom, intend to subscribe to their full entitlement except for a renunciation by Bharti Telecom in favour of GIC Singapore, which will commit approximately $700 million,” said Singapore Telecommunications (Singtel), the company’s largest stakeholder, in a release.

“GIC has confirmed to subscribe to this renounced entitlement on behalf of the Singapore government and Monetary Authority of Singapore,” Bharti Airtel said. GIC is a sovereign wealth fund established by the Singapore government and will get a 4% stake in Bharti Airtel after the issue.

The Bharti Airtel promoter group, including Bharti Telecom will subscribe to shares worth Rs 11,785.7 crore, with the rest going to the public. Singtel said it will subscribe to 170 million new shares in the rights issue for Rs 3,750 crore ($525 million), representing its 15% direct stake in the telco.

Singtel holds its shares in Airtel directly and through its 48.9% effective interest in Bharti Telecom, which in turn holds a 50.1% stake in the Sunil Mittal-led telco. The Mittal family’s effective interest in Bharti Telecom is 51.1%. Singtel said its effective interest in Airtel will drop to 35.2% - from 39.5% now - with “the renunciation to GIC and upon closing of the rights issue” but it would continue to be “the single largest shareholder in Airtel.”

Insiders estimate the Singtel-Mittal family combined holding will dip to around 63% from 67.14%. The Mittal family will maintain its stake at around 27%.

Further, the promoters can buy any shares not picked up in the rights offer either themselves or through others, in line with current laws, the company said.

The Bharti Airtel board cleared plans last week to raise Rs 32,000 crore through a Rs25,000 crore rights issue at Rs220 a share, and bond sales of Rs 7,000 crore in one of the largest fund-raising exercises by an Indian company. Airtel said it is in the process of appointing banks to take the bond issue forward.

“Our partnership in this rights offering with our partners (read: Airtel) and a leading investor such as GIC reflects our long-standing commitment to Airtel and confidence in the future of the Indian market,” Arthur Lang, Singtel International Group CEO, said in a statement.

Shares in Airtel, which is fighting a bitter battle to protect its market share against a pricing onslaught by Reliance Jio Infocomm, closed down 0.2% at Rs 308.75 on the BSE Thursday. Airtel needs funds to rapidly expand its 4G network and match that of Jio.

Gopal Vittal, Airtel’s chief executive, India and South Asia, said the rights issue would “further strengthen the company’s balance sheet with desired financial flexibility so as to meet future opportunities, particularly in the rapidly transforming Indian mobile market”.

S&P Global Ratings recently cautioned that Airtel’s upcoming rights issue is not enough to stabilise its credit rating. Moody’s Investor Service though said, the issue, if completed, would be credit positive as it would allow Airtel to cut debt and improve liquidity.