 "Vodafone, Idea to sell their tower biz to ATC for Rs 7,850 crore")
Telecom majors Vodafone India and Idea Cellular have agreed to sell their respective tower businesses in India to ATC Telecom Infrastructure Private (ATC TIPL) for Rs 7850 crore or $1.2 billion. The two operators have about 20,000 towers.
Vodafone and Idea are in the process of merging operations to create the largest mobile operator in the country.
While Idea Cellular would get Rs 4,000 crore, Vodafone would get Rs 3,850 crore if the tower deal goes through prior to their merger.
The purchase would give ATC, which operates almost 150,000 communications sites globally, an additional 20,000 towers in a country with more than 1 billion mobile-phone subscribers.
The purchase would give ATC, which operates almost 150,000 communications sites globally, an additional 20,000 towers in a country with more than 1 billion mobile-phone subscribers.
The standalone tower businesses of Vodafone India and Idea are pan-Indian passive telecommunication infrastructure businesses, comprising a combined portfolio of approximately 20,000 towers with a combined tenancy ratio of 1.65x as at June 30, 2017," said a joint statement from Idea and Vodafone.
"Both Vodafone India and Idea as customers, and ATC as a mobile network infrastructure provider have agreed to treat each other as long-term preferred partners, subject to existing arrangements. The parties will work together to further the expansion of high-speed mobile networks in India," it added.
Idea on Monday reported a consolidated net loss of Rs 1,106.8 crore for the second quarter of the current fiscal.
It was decided that post-merger Vodafone India will own 45.1% of the merged entity after it transfers about 4.9% to promoters of Idea and/or their affiliates for Rs3,874 crore.
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The agreement is expected to be completed during the first half of 2018.
Earlier this year, Vodafone India and Idea had agreed to merge their operations to create the country's largest telecom operator worth of more than $23 billion with a 35 per cent market share.
The combined entity of Vodafone India and Idea Cellular, which are currently India's number 2 and 3, respectively, would dislodge Bharti Airtel to counter the bruising price war in the worlds second-largest telecom market.