Telecom operator Idea Cellular today said it has completed the sale of approximately 9,900 mobile towers to American Tower Corporation's Indian arm for Rs 4,000 crore.
"...completion of sale of its (Idea) pan-India standalone tower business, by way of divesting its entire stake in ICISL, 100 per cent subsidiary of Idea, to ATC Telecom Infrastructure Private Limited. The transaction has been closed with an enterprise value of Rs 40 billion for approximately 9,900 standalone towers," Idea said in a statement.
ATC has already completed acquisition of Vodafone India's mobile tower for Rs 3,850 crore, which added nearly 10,200 to its portfolio.
"We are pleased to acquire this portfolio, which will complement our existing footprint and help us serve our tenants in India as they expand their 4G networks in the coming years," Amit Sharma, American Tower's EVP and President, Asia said.
After closure of the deal, ATC pips BSNL to become second largest mobile tower company in the country. It now has around 78,000 cell sites while state-owned BSNL had around 66,000 mobile towers in the country.
"This transaction also expands our presence in Central, North and Northeast India --Assam, Bihar, Himachal Pradesh, Madhya Pradesh, North East, Orissa and Jammu & Kashmir Circles, among others under-served areas in which we expect substantial future 4G-focused investments," Sharma said.
Indus Tower continues to be biggest mobile tower firm in the country with a portfolio of more than 1,22,962 towers. It is in process of merging business with Bharti Infratel which will have combined portfolio of over 1.63 lakh towers.
Idea and Vodafone will use the proceeds to lower debt of their merged entity.
"The receipt of both these proceeds prior to completion was anticipated and provided for, in the Vodafone India and Idea merger agreement and hence would not affect the agreed terms of the merger, including the amount of debt which Vodafone will contribute to the combined entity at the closing of merger transaction," the statement said.
The deal brings merger of Vodafone India and Idea, resulting in creation of country's largest telecom operator with around 430 million subscribers, closer as change in structure of the organisations would have created complexity in document work for clearing standalone tower deals of Idea and Vodafone with ATC.
Idea said post completion of the merger, 6,300 co-located tenancies of the two operators on the combined standalone tower portfolio will collapse into single tenancies over a period of two years without the payment of exit penalties.
"Both Vodafone India and Idea as customers, and ATC as a vendor, has agreed to treat each other as long term preferred partners, subject to existing agreements," the statement said.
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