American Tower Company (ATC) could soon sell a majority stake in its Indian company to US-based I Squared Capital. As per an ET report, the tower company may be looking to sell a 51% stake in ATC Telecom Infrastructure Pvt Ltd. The company could entirely cash out as well at an enterprise value of $1.5-$2.0 billion USD. But I Squared isn't the only player who is looking for a stake in the Indian tower company. There are other players, including Stonepeak Partners and Canada's Brookfield.
Read More - ATC Records $16 Million Unrealised Loss on Vodafone Idea's OCDs
The ET report mentioned that the two parties have entered into a 60-day exclusive agreement for bilateral negotiations. The result of this could be ATC selling a 51% stake in its Indian unit. There's no guarantee over how much stake I Squared Capital wants in the company right now. Thus, the final deal size would depend on the decision of I Squared over how much stake it wants in the Indian tower business.
Why is ATC Looking to Sell its India Business?
To recall, in February, ATC informed the US Securities and Exchange Commission (SEC) that it was looking for strategic alternatives including the sale of an equity stake in its India operation to one or more private companies. This is because Vodafone Idea Limited (VIL), its largest customer, is not in a position to clear dues to the company.
Read More - ATC Looking to Sell Stake in India Business to Reduce Exposure
It is worth noting that Vodafone Idea (Vi) had given OCDs (optionally convertible debentures) worth Rs 1600 crore against dues to ATC's Indian unit. The OCDs of Vi will mature in two tranches of Rs 800 crore on August 27, 2023 and August 27, 2024. The first tranch maturity is very close now. ATC has already taken a $411.6 million impairment charge due to Vi's partial contractual payments.
