Mumbai (Maharashtra) [India], Nov 13 (ANI): Vodafone India and Idea Cellular Limited have separately agreed to sell their respective standalone tower businesses in India to ATC Telecom Infrastructure Private Limited for an aggregate enterprise value of Rs. 78.5 billion.
The standalone tower businesses of Vodafone India and Idea are pan-Indian passive telecommunication infrastructure businesses, comprising a combined portfolio of approximately 20,000 towers with a combined tenancy ratio of 1.65 times as at June 30, 2017.
Idea will sell its entire stake in ICISL and Vodafone India will sell a business undertaking to ATC TIPL. Both Vodafone India and Idea as customers, and ATC TIPL as a mobile network infrastructure provider, have agreed to treat each other as long-term preferred partners, subject to existing arrangements. The parties will work together to further the expansion of high speed mobile networks in India.
After Vodafone India and Idea completed their merger, 6,300 co-located tenancies of the two operators on the combined standalone tower businesses will collapse into single tenancies over a period of two years without the payment of exit penalties.
This transaction follows the Vodafone India / Idea merger announcement of March 20, whereby the parties announced their intention to sell their individual standalone tower businesses to strengthen the balance sheet of the combined business.
In the event that the completion of the sale of the standalone tower businesses precedes the completion of the proposed merger of Vodafone India and Idea, Vodafone India will receive Rs 38.5 billion, while Idea will receive Rs 40.0 billion.
The receipt of these proceeds prior to completion was anticipated and provided for in the merger agreement and hence would not affect the agreed terms of the Vodafone India and Idea merger, including the amount of debt which Vodafone will contribute to the combined company at completion.
On a related note, completion of the transaction is subject to customary closing conditions and receipt of necessary regulatory approvals, and is expected to take place during the first half of calendar year 2018. (ANI)