Idea Cellular, Vodafone India to sell telecom towers to American Tower

Idea Q2 vs Q1

Idea Q2 vs Q1

The tower deal will not affect the merger terms of the two companies.

Idea Cellular and Vodafone India agreed to sell their mobile phone tower units to American Tower Corp., as carriers seek to sell assets to pare their mounting debt amid a price war that eroded their profitability.

Jim Taiclet, American Tower's Chief Executive Officer stated, "We expect the addition of these two high quality portfolios to be highly complementary to our existing assets and to contribute to long-term leasing growth as India's leading mobile operators accelerate their 4G network deployments".

ATC Telecom is a network of 20,000 towers across India.

It merged its loss-making Indian mobile business with Idea, India's third-largest wireless operator, at the start of the year. Upon completion of the sale of tower businesses, Vodafone India will receive $592 million and Idea will receive $615 million.

During an exchange filing on Monday, the Idea Cellular said, "The sale of the company's standalone business will be achieved through the sale of the entire shareholding of ICISL (Idea Cellular Infrastructure Services Ltd) by the company comprising 60,000 equity shares of Rs10 each to the purchaser". It will have revenue of Rs81,600 crore and an operating profit of Rs24,400 crore.

Idea and Vodafone India have a total of about 20,000 towers, with 1.65 tenants each on average, as of 30 June 2017.

Vodafone (LON:VOD) has inked a deal to sell its standalone tower business in India, the blue-chip telco has said. The deal is expected to close in 2018.

Indus-the biggest tower company-is a three-way joint venture among Idea, Vodafone and Bharti Airtel, which also controls Bharti Infratel.

The agreement, subject to closing conditions and regulatory approval, is expected to be completed during the first half of 2018, ATC said in a statement on Monday.

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