Brookfield Infra buys Indian Telecom Towers; deal equity value is $3.7 bn

Brookfield Infrastructure Partners, alongside its institutional partners, on Monday said it has entered into binding agreements to acquire a 100 per cent stake in a telecom tower company in India from Reliance Industrial Investments and Holdings Limited (RIIHL), a wholly-owned subsidiary of Reliance Industries Limited (RIL). The total equity requirement is $3.7 billion, of which Brookfield Infrastructure will invest approximately $375 million, with the balance being funded by its institutional partners.

Brookfield Infrastructure is acquiring a portfolio of approximately 130,000 communication towers that forms the infrastructure backbone of Reliance Jio’s (Jio) telecom business. These are recently constructed assets that are strategically located for pan-India 4G coverage. These towers are well-positioned from a competitive perspective as they are largely connected by fiber backhaul, which provides a unique platform to capitalize on the rollout of 5G and future technologies. Jio is an anchor tenant of the tower portfolio under a 30-year Master Services Agreement, providing a secure source of revenues for the tower company.

“This is a unique opportunity to invest in a large-scale, high-quality telecom business and participate in India’s high-growth data industry,” said Sam Pollock, Chief Executive Officer of Brookfield Infrastructure. “This is an attractive business that offers downside protection with meaningful upside by co-locating equipment from other Mobile Network Operators on the towers, which to-date, have only carried Jio equipment. Further growth is anticipated through a tower build-out program, which is expected to bring the portfolio to approximately 175,000 towers.”

“We are pleased to be continuing our relationship with Reliance, following our successful Indian gas pipeline investment completed earlier this year,” said Anuj Ranjan, Managing Partner and Head of India and the Middle East for Brookfield. “Leveraging the strength of our partnership with Reliance, combined with the depth of Brookfield Infrastructure’s operating expertise, makes us well-positioned to execute on future growth for the business.”

Closing of the transaction is subject to certain regulatory approvals.

Brookfield Infrastructure Partners is a leading global infrastructure company that owns and operates high quality, long-life assets in the utilities, transport, energy and data infrastructure sectors across North and South America, Asia Pacific and Europe. We are focused on assets that generate stable cash flows and require minimal maintenance capital expenditures.

Brookfield Infrastructure is the flagship listed infrastructure company of Brookfield Asset Management, a leading global alternative asset manager with over $500 billion of assets under management. More information is available at www.brookfield.com.