The Department of Telecom (DoT) on Friday approved the merger of the country's largest mobile tower company Indus Towers with Bharti Infratel, according to official sources.
The combination of Bharti Infratel and Indus Towers will create a pan-India tower company with over 163,000 towers, operating across all 22 telecom service areas. The combined entity will be the largest tower company in the world outside China.
"DoT has approved merger of Indus Towers with Bharti Infratel," an official source told PTI.
Bharti Infratel and Vodafone hold 42 per cent stake each in Indus.
Vodafone Idea holds 11.15 per cent stake in the mobile tower firm.
As per the plans, the combined company, which would fully own the respective businesses of Bharti Infratel and Indus Towers, would change its name to Indus Towers Ltd and will continue to be listed on Indian stock exchanges.
The timely completion of the tower deal is critical for the companies, as it would allow Bharti and Vodafone Idea in offloading stake and raising funds.In April 2018, Bharti Airtel, Idea Cellular, and Vodafone Group had announced an agreement for the merger of Indus Towers and Bharti Infratel to create the largest mobile tower operator in the world outside China. According to the original deal structure, Vodafone was to be issued 783.1 million new shares in the merged entity in exchange for its 42 per cent stake in Indus Towers, and this could take its holding to 29.4 per cent in the new company, depending on the options finally taken by Idea and Providence. Similarly, Airtel’s stake in the new combined tower behemoth was to be diluted to 37.2 per cent in the combined entity, from 53.5 per cent it currently holds in Bharti Infratel. The transaction at the time of the deal announcement valued Indus Towers at an enterprise value of Rs 71,500 crore.