You are here: Home » Markets » News
Business Standard

Bharti Infratel zooms 5% as Board okays Indus Tower merger; Voda Idea up 8%

Vodafone Idea has decided to cash out by selling its 11.15 percent stake in Indus. The move comes ahead of the Supreme Court's verdict in the AGR case today

Topics
Buzzing stocks | Indus Towers Bharti Infratel merger | Bharti infratel

SI Reporter  |  New Delhi 

As per reports, the merged entity will become largest tower company in the world outside China
As per reports, the merged entity will become largest tower company in the world outside China

Shares of leaped 5 per cent to Rs 208 on the BSE on Tuesday after the company's board approved its merger with Indus Tower.

"The Board of Directors in its meeting held on August 31, 2020 took note of the status of Scheme of Arrangement between Indus Towers and Limited and the related agreements. After deliberations, the Board has decided to authorise the chairman to proceed with the Scheme and to comply with other procedural requirements for completion of the merger including approaching NCLT to make the Scheme effective subject to certain procedural condition precedents," it said in a regulatory filing. READ HERE

As per the company, Infratel will be a majority shareholder in the merged entity with a likely stake of 68.6 per cent, while London-listed Vodafone Group Plc will hold 28.2 per cent stake, it said in a statement.

has decided to cash out by selling its 11.15 percent stake in Indus. The move comes ahead of the Supreme Court's verdict in the AGR case. The apex court is scheduled to pronounce its decision on the staggered payment timeline at 11:30 am today.

"The above is basis cash consideration chosen by Limited (VIL) for its 11.15 per cent shareholding in Indus which will be based on 60 days VWAP as at Closing date (and agreed closing adjustments). Based on today’s calculation the cash consideration comes to approximately Rs 4,000 crore, it said in a statement.

Stock of the telecom operator zoomed 8 per cent in the intra-day trade to quote at Rs 10.92 on the BSE.

"To secure the payment obligation of VIL under the MSAs, VIL and Vodafone Group Plc. (V Plc.) have entered into certain security arrangements with the Company for the benefit of the Merged Company. This includes a combination of a security deposit by VIL, security via pledge of a certain number of shares of the Merged Company out of those issued to V Plc. (as part of the Scheme) and a Corporate Guarantee by V Plc. which can get triggered in certain situations and events. These security arrangements remain subject to all applicable regulatory approvals and any approval of V Plc’s lenders. The security arrangement will provide the Merged Company a payment cover of over one year for the operational payments due from VIL," it said.

As per reports, the merged entity will become largest tower company in the world outside China, with a pan-India tower company comprising 163,000 towers across 22 telecom service areas.

Indus Towers is a joint venture between Bharti Infratel, UK-based Vodafone Group Plc and and Indus Towers have overlapping operation in four circles - Haryana, Uttar Pradesh and Rajasthan.

Bharti Infratel had said in a presentation that the new entity would have a turnover of more than Rs 25,000 crore, controlling more than a third of the tower industry in the country. It also stated that it might save close to Rs 560 crore annually.

At 9:51 am, Bharti Infratel was up 3 per cent at Rs 204 on the BSE, as against 0.5 per cent rise in the S&P BSE Sensex.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Tue, September 01 2020. 09:52 IST
RECOMMENDED FOR YOU
.