Bharti Infratel slips as Indus Towers deal gets delayed

Bharti Infratel slipped 0.74% to Rs 253.40 after the company extended its deadline for the proposed merger with Indus Towers till February 2020.

Bharti Infratel on Tuesday (24 December) said it has not received government approvals for its merger with Indus Towers, by the 24 December 2019 deadline, and hence it has extended the deadline for closing the deal to 24 February 2020.

"Completion of merger is contingent upon receipt of requisite regulatory approvals and fulfilment of other conditions precedent, the company said in filing. It added that "there can be no assurance that the merger can be completed within the extended time-frame.

Incorporated in November 2007, Indus Towers offers passive infrastructure services to all telecom operators and other wireless services providers such as broadband service providers. It has been promoted under a joint venture between entities of Bharti Airtel and Vodafone Idea.

With 1,24,692 towers in 15 circles across the country, Indus has the widest coverage in India and has already achieved 2,31,500 tenancies.

The proposed merger of Bharti Infratel with Indus Towers aims to create one of the world's largest telecom tower companies with more than 163,000 towers.

The Bharti Infratel and Indus Towers merger deal was signed on April last year and was to have been completed by October this year. This was extended to 24 December 2019 after the companies did not get government clearance by the initial deadline.

According to the media reports, the merger is crucial as it will help loss-making telecom companies Bharti Airtel and Vodafone Idea sell stake to raise funds in the competitive telecom battleground, especially at a time when they have to pay huge dues to the department of telecommunications after an unfavourable court verdict in October.

Bharti Airtel has set aside Rs 34,260 crore and Vodafone Idea has made provisions for Rs 25,677.9 crore in the September quarter after the Supreme Court upheld the government's definition of revenue based on which telecom companies pay levies.

Bharti Infratel is on the largest telecom tower infrastructure providers that deploys, owns and manages telecom towers and communication structures for all wireless operators.

The company reported 60.6% jump in consolidated net profit to Rs 963.50 crore on a 3% decline in net sales to Rs 1668.30 crore in Q2 September 2019 over Q2 September 2018.

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