Connect with us

Headlines of the Day

Vodafone Idea, Reliance Jio make separate tower moves

Bharti Infratel announced today (1 September) it will move ahead with a long-delayed merger with Indus Towers as part of a new deal which will see struggling Vodafone Idea sell its 11.15 per cent stake for about INR40 billion ($549.3 million).

In a statement, Bharti Infratel said it will be become the majority shareholder in the merged tower company, with a likely stake of 68.6 per cent. Vodafone Group will have a 28.2 per cent holding. The final percentages will be based on closing adjustments.

Bharti Airtel agreed to combine its tower business with Indus Towers in April 2018, a move it said at the time would create the world’s largest tower company outside of China, with an estimated enterprise value of INR965 billion.

Airtel and Vodafone each hold a 42 per cent stake in Indus Tower.

The original merger of the tower companies ran into a major obstacle around the pricing structure.

To secure the payment obligation under the agreement, Vodafone Idea and Vodafone Group struck agreements with Bharti Infratel covering security deposits and a corporate guarantee, which are subject to regulatory and other approvals.

The move comes a day after Reliance Industries completed a sale of tower assets of its mobile unit Reliance Jio to Brookfield Infrastructure Partners for INR252 billion.

Approval from the Department of Telecommunications contains a number of conditions, including the new investor not receiving an assured return upon exit, and compliance with Reserve Bank of India and Securities and Exchange Board of India guidelines and regulations, The Economic Times reported.

The deal covers about 130,000 towers operated by Reliance Jio Infratel and a plan to build an additional 45,000.

Reliance Jio is the anchor tenant under a 30-year agreement. Mobile World Live

Click to comment

You must be logged in to post a comment Login

Leave a Reply

Copyright © 2024 Communications Today

error: Content is protected !!