Bharti Airtel entered into a contract with Euro Pacific Securities, an affiliate of Vodafone Group Plc to acquire 4.7% stake in Indus Towers and its wholly-owned subsidiary, Nettle Infrastructure Investments for an all cash deal of Rs 2,388.06 crore.
Bharti Airtel will purchase 4.7% equity stake of Indus Towers and its wholly-owned subsidiary, Nettle Infrastructure Investments, from Euro Pacific Securities, an affiliate of Vodafone Group Plc, on the principal condition that the amount paid shall be inducted by Vodafone Idea as fresh equity in Vodafone Idea (VIL) and simultaneously remit to Indus Towers to clear VIL's outstanding dues.
The transaction shall be executed at Rs 187.88 per share basis the agreed price formula in the agreement, aggregating to Rs 2,388.06 crore, upon fulfillment of all conditions precedents as agreed by the parties under the agreement.
Indus Towers along with Nettle Infrastructure Investments, a wholly owned subsidiary of the company, currently hold 41.73% shareholding of Indus Towers.
As per press statement, Bharti Airtel is protected with a capped price which is lower than the price for the block of Indus shares sold by Vodafone on 24 February 2022. This shall be value accretive to Airtel and protect its existing significant shareholding in Indus Towers. Any such acquisition shall only be done when such proceeds are confirmed to be utilised by Vodafone Idea to infuse as equity into VIL including any regulatory or shareholders' approval being fully obtained.
This transaction will allow Bharti Airtel to secure continued strong provision of services from Indus Towers, protect and enhance Bharti Airtel's value in Indus Towers, enabling it to receive dividends and subsequent financial consolidation of Indus Towers in Bharti Airtel.
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On 25 February 2022, Bharti Airtel had said it has signed an agreement to buy Vodafone Idea's 4.7% stake in Indus Towers on the condition that the proceeds will be used for investment in Vodafone Idea and clearing its dues towards the mobile tower company.
Shares of Bharti Airtel rose 1.04% to Rs 716.60 on BSE. The company reported a 2.8% decline in consolidated net profit to Rs 830 crore in Q3 FY22 over Q3 FY21. Total revenues stood at Rs 29,867 crore during the quarter, up 12.6% Y-o-Y.
Bharti Airtel is a global communications solutions provider with over 480 million customers in 16 countries across South Asia and Africa.
Shares of Vodafone Idea shed 1.19% at Rs 9.99 on BSE. On a consolidated basis, Vodafone Idea reported a net loss of Rs 7,230.90 crore in Q3 December 2021 as against net loss of Rs 4,532.10 crore in Q3 December 2020. Net sales declined 10.80% to Rs 9,715.50 crore in Q3 December 2021 over Q3 December 2020.
Vodafone Idea is an Aditya Birla Group and Vodafone Group partnership. It is amongst India's leading telecom service provider. The company provides pan India Voice and Data services across 2G, 3G and 4G platforms.
Shares of Indus Towers advanced 3.71% to Rs 210.80 on BSE. Indus Towers reported a 60.4% jump in consolidated net profit to Rs 1,570.8 crore on a 70.6% rise in net sales to Rs 6,927.4 crore in Q3 FY22 over Q3 FY21.
Indus Towers is formed by the merger of Bharti Infratel and Indus Towers. It has over 1,84,748 towers and 3,35,106 co-locations (as on 31 December 2021) and a nationwide presence covering all 22 telecom circles. Indus' leading customers are Bharti Airtel (together with Bharti Hexacom), Vodafone Idea and Reliance Jio Infocomm.
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