ATC Telecom Infrastructure, a majority-owned subsidiary of American Tower Corporation, hopes to complete its purchase of the standalone tower business of Vodafone India and Idea Cellular during the first half of 2018. The total value of the separate transactions is ₹77 billion (US$1.2 billion).
The transaction follows the announcement in March of the merger between Vodafone India and Idea, where the parties pledged to sell their tower businesses to strengthen the balance sheet of their combined entity.
If the tower business divestments are completed before the Vodafone-Idea merger, Vodafone India will receive US$592 million and Idea will receive US$621 million.
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“The clear overall trend in the telecom and telecom tower sectors is towards consolidation,” Rajat Sethi, a partner at S&R Associates and adviser to Vodafone, told India Business Law Journal. “From a transactional perspective, this trend is likely to continue into the foreseeable future.”
The tower businesses of both Vodafone India and Idea are pan-Indian passive telecommunication infrastructure businesses comprising a combined portfolio of approximately 20,000 towers.
Idea will sell its entire stake in Idea Cellular Infrastructure Services, and Vodafone India will sell a business undertaking to ATC Telecom Infrastructure.
Both Vodafone India and Idea as customers, and ATC Telecom Infrastructure as a mobile network infrastructure provider, have agreed to consider each other as long-term preferred partners and work together to further the expansion of high-speed mobile networks in India.
S&R Associates advised Vodafone Group and Vodafone India on the deal. The team comprised partners Sethi and Radhika Iyer and associates Jagriti Mohata, Dhruv Nath, Raya Hazarika, Meher Mehta and Sushmita Sur.
Partners Gautam Saha, Amrita Patnaik and Heena Singh at AZB & Partners represented American Tower Corporation. Partner Ravi Prakash advised on tax issues.
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