Bharti Airtel Approves the Merger of Indus Towers and Bharti Infratel

Bharti Airtel has now approved the merger proposal of Bharti Infratel and Indus Towers, creating a listed pan-India tower company. The combination of Bharti Infratel and Indus Towers by way of a merger will create a pan-India tower company, with over 163,000 towers, operating across all 22 telecom circles in India. The combined company will be the largest tower company in the world outside China, read a media statement. The combined company will be named as Indus Tower Limited and will continue to be listed on the Indian Stock Exchanges going forward. The merger is now subject to approvals from the relevant regulatory authorities, including from CCI, SEBI, NCLT, DoT (FDI approval), approval from Bharti Infratel’s shareholders, necessary corporate approvals from the companies involved, as well as closing conditions. The transaction is expected to complete before the end of the financial year ending March 31, 2019.


Indus Towers is currently jointly owned by Bharti Infratel (42%), Vodafone (42%), Idea Group (11.15%) and Providence (4.85%). They today announced that they have agreed to merge Vodafone’s, Idea Group’s and Providence Equity Partners’ respective shareholdings in Indus Towers Limited into Bharti Infratel, creating a combined company that will own 100% of Indus Towers. Post the transaction, the combined company’s equity value would be Rs 965 billion.

That said, the combination of the two highly complementary footprints will create a tower operator with the ability to offer the high quality shared passive infrastructure services needed to support the pan-India expansion of wireless broadband services using 4G/4G+/5G technologies for the benefit of Indian consumers and businesses. And the media statement also read that the move will also help in the delivery of Government of India’s vision of ‘Digital India’.

Idea Group has the option to either sell its 11.15% shareholding in Indus Towers for cash based on a valuation formula linked to the VWAP for Bharti Infratel’s shares during the 60 trading days prior to completion of the merger, which, if calculated at the time of this announcement, would equate to a cash consideration of Rs 65 billion. Alternatively, Idea Group will receive new shares in the combined company based on the Merger Ratio. All the proceeds from the sale of the 11.15% stake will be for the benefit of the entity resulting from the merger of Vodafone India and Idea Group.

Speaking about the Providence, it has the option to elect to receive cash or shares for 3.35% of its 4.85% shareholding in Indus Towers, with the balance exchanged for shares.

Vodafone will be issued with 783.1m new shares in the combined company, in exchange for its 42% shareholding in Indus Towers. On the basis that Providence decides to sell 3.35% of its 4.85% shareholding in Indus Towers for cash, and Idea Group decides to sell its full 11.15% shareholding in Indus Towers for cash, these shares would be equivalent to a 29.4% shareholding in the combined company. The Transaction values Vodafone’s shareholding at Rs 284 billion.

If Providence decides to sell 3.35% of its 4.85% shareholding in Indus Towers for cash, and Idea Group decides to sell its full 11.15% shareholding in Indus Towers for cash, Bharti Airtel’s shareholding will be diluted from 53.5% in Bharti Infratel to 37.2% in the combined company.

Having said that, the final number of shares issued to Vodafone and the cash paid or shares issued to Idea Group and Providence, will be subject to closing adjustments, including but not limited to movements in net debt and working capital for Bharti Infratel and Indus Towers. To be noted, Bharti Airtel and Vodafone will jointly control the combined company, in accordance with the terms of a new shareholders’ agreement.

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4 Comments on "Bharti Airtel Approves the Merger of Indus Towers and Bharti Infratel"


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April 25, 2018 7:35 pm 7:35 PM

Bharti – indus merged company will have total 163000 towers ( 39500 of bharti & over 122000 of indus).

Jio after rcom towers acquisition will have 162000 towers. (Jio has 119000 towers of its own & 43000 towers of rcom)

Jio does not provide its towers for third party tenants.

Kaushik IMA
April 25, 2018 3:48 pm 3:48 PM

Given Vodafone’s pending exit from India, I am not sure this is quite a good deal. Let’s see.

April 25, 2018 1:13 pm 1:13 PM

Airtel will be the largest shareholder in this tower Corporation even after combined ideafone.

Chetan Malhotra
April 25, 2018 2:24 pm 2:24 PM

In subsequent news, Airtel has also announced to sell its entire Stake post Infratel and Indus merger to KKR or other potential bidders…
Reason for this is as Tower is not core business of telecom service provider and Bharti believes that it should be managed by third party only…