 "vodafone idea")
Vodafone Idea (Vi) will issue equity shares worth Rs 1,440 crore to ATC Telecom Infrastructure Pvt Ltd (ATC TIPL), the Indian arm of American Tower Corporation, Vi said on Tuesday.
On March 18, ATC TIPL requested the 14,400 optionally convertible debentures (OCDs) held by it be converted into 1,440 million shares at a face value of Rs 10 each, the telecom operator said in an exchange filing. The move will marginally reduce Vi’s debt burden.
In February last year, loss-making Vi had allotted OCDs worth Rs 1,600 crore to ATC TIPL against the dues to the latter. The proceeds were being used by Vi to clear its dues to the US tower company, estimated at more than Rs 2,000 crore.
OCDs are debt securities on which the issuer pays interest to the investor till the maturity date.
In the second quarter of calendar year 2023, ATC had said it recognised a Rs 238.5 crore ($29 million) unrealised gain on the OCDs.
More From This Section
The conversion price of Rs 10, at the time of OCD issuance was at a premium to the then prevailing market price of Vodafone Idea shares. Subsequently, the term of redemption of the first tranche of OCDs, amounting to Rs 800 crore, was extended from the initial six months to 18 months, in August 2023.
“ATC TIPL is one of the largest infrastructure service providers for VIL and both entities have a long-term relationship,” Vi said on Tuesday. After the latest announcement, ATC TIPL will still hold OCDs worth Rs 160 crore.
However, ATC’s India business is itself set for a change in corporate ownership this year.
In January, Canada-based Brookfield Asset Management acquired ATC TIPL for an enterprise value of Rs 16,628 crore. The transaction is subject to regulatory approval and expected to close in the second half of 2024, Brookfield said.
The combined entity is expected to have over 253,000 towers, trumping the current market leader Indus Towers and its 204,000 tower sites.
