The American Tower Company (ATC) is looking to sell a stake in its Indian business unit to one or more private investors. The Boston-based tower company wants to reduce exposure in the Indian market. Vodafone Idea (Vi), the ailing private telecom company, is the biggest customer of ATC in India. According to an ET report, in a recent filing in US Securities and Exchange Commission (SEC), the company said that the stake sale would be a part of its broader efforts to reduce its exposure in India.
It is worth noting that Vodafone Idea had earlier said that it would not be able to make payments in full because of financial issues. The telco is also trying to raise funds to help its business surface to a level where it can compete with the other private telcos such as Reliance Jio and Bharti Airtel.
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"We are sensitive to adverse changes in the creditworthiness and financial strength of our customers…we are exploring various strategic alternatives , including the sale of an equity interest in our India operations to one or more private investors, (though), any such proposed transaction would be subject to conditions, including regulatory approvals in India," ATC said in an SEC filing dated February 23.
At present, ATC has 100% ownership in its India unit called ATC Telecom Infrastructure Pvt Ltd, that holds an infrastructure provider category-I (IP-I) registration certificate issued by the communnications ministry. The inability of Vi to clear its dues to ATC has posed a big challenge for the tower company.
To recall, late in February, Vi had also allotted optionally convertible debentures (OCDs) worth Rs 1600 crore to ATC. This happened after the telco could see the conversion of statutory interest dues into equity for the government.
