ALSO READIdea Cellular posts third straight loss amid price war CORRECTED - Idea Cellular posts smaller-than-expected second-quarter loss Idea Cellular posts bigger-than-expected second-quarter loss Idea Cellular posts quarterly loss; to sell tower unit Idea Cellular posts smaller-than-expected second loss
Vodafone India and Idea Cellular on Monday separately agreed to sell their respective standalone tower businesses in India to ATC Telecom Infrastructure Private Limited (formerly Viom) for an aggregate enterprise value of Rs 7,850 crore ($1.2 billion), a company 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 ($592 million) and Idea will receive Rs 4,000 crore ($615 million).
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 1.65 times as on June 30, 2017.
"Both Vodafone India and Idea as customers, and ATC TIPL 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," the statement said.
The statement said that 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 coalesce into single tenancies over a period of two years without the payment of exit penalties.
"This transaction follows the Vodafone India/Idea merger announcement of March 20, 2017 whereby the parties announced their intention to sell their individual standalone tower businesses to strengthen the balance sheet of the combined business," it said.
Completion of the transaction is subject to customary closing conditions and receipt of necessary regulatory approvals, and is expected to take place during the first half of calendar year 2018.
Idea Cellular has posted consolidated net loss of Rs 1,106.80 crore for the second quarter (July-September) of 2017-18 fiscal.
Consolidated revenue for the quarter stood at Rs 7,465.50 crore, compared to Rs 9,300.30 crore posted during the corresponding period in 2016-17.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)