In yet another important in the Indian telecom sector, Vodafone India and Idea Cellular has sold their mobile tower businesses to American Tower Corporation…
NEW DELHI, NOVEMBER 13, 2017: After having announced their merger, India’s second and third largest telecom operators – Vodafone India and Idea Cellular – on Monday said they will sell their standalone mobile towers business to a subsidiary of American Tower Corporation (ATC) for an enterprise value of Rs.7,850 crore (around $1.2 billion). Selling over 20,000 mobile towers is a part of the merger agreement between Vodafone and Idea announced March this year.
In a joint statement, the two operators said they have separately agreed to sell their respective standalone tower businesses in India to ATC Telecom Infrastructure Pvt Ltd (ATC TIPL, formerly Viom) for an “aggregate enterprise value of Rs 7,850 crore ($1.2 billion)”. As part of the deal, Idea will sell its entire stake in ICISL and Vodafone India will sell a business undertaking to ATC TIPL. The deal is expected to be closed by January-June 2018. The deal will help reduce the combined debt of the merged entity by Rs.7,850 crore and that of Idea on a standalone basis by Rs.4,000 crore.
The joint statement said: “In the event that the completion of the sale of the standalone tower businesses precedes the completion of the proposed merger of Vodafone India and Idea, Vodafone India will receive Rs 3,850 crore billion ($592 million) and Idea will receive Rs 4,000 crore ($615 million). The receipt of these proceeds prior to completion was anticipated and provided for in the merger agreement and hence would not affect the agreed terms of Vodafone India and Idea merger, including the amount of debt which Vodafone will contribute to the combined company at completion”.
“After Vodafone India and Idea have completed their merger, around 6,300 co-located tenancies of the two operators on the combined standalone tower businesses will collapse into single tenancies over a period of two years without the payment of exit penalties,” the joint statement said.
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