Idea Cellular-ATC Tower Deal Approved by DoT

The Department of Telecommunications (DoT) on Thursday cleared the sale of Idea Cellular’s standalone towers to the Indian arm of American Tower Corp (ATC) for Rs 4000 crore. The deal was awaiting approval on the FDI clearance from the Department of Industrial Policy & Promotion (DIPP), which has come. “Idea-ATC, captive towers deal, has been approved,” a top DoT official told ET. Queries sent to Idea and ATC did not elicit any response. In November last year, ATC Telecom Infrastructure inked a deal with Vodafone India and Idea to buy their standalone towers, a little more than 20,000 for a value of Rs 7,850 crore. The deal excluded holding of Vodafone and Idea in Indus Towers.

idea-cellular-atc-deal-dot

This marks the conclusion of the US tower company’s two-stage buyout of Vodafone India and Idea’s near 20,000-odd combined standalone towers for Rs 7,850 crore.

Last month, ATC had completed the acquisition of Vodafone India’s around 10,926 telecom towers in India for Rs 3,850 crore. Deal closure with Idea will add another 9800 towers to the portfolio of ATC Telecom Infrastructure.

With the acquisition of Vodafone and Idea’s towers, the ATC subsidiary now has 80,000 mobile towers in its portfolio. This brings it closer to market leader Indus Towers and Bharti Infratel who own 1,23,000 and 91,000 towers respectively.

The Boston-based independent tower operator has been steadily bolstering its India towers portfolio, having bought 51% stake in the erstwhile Viom Networks for Rs 7635 crore in FY16. The new towers will complement ATC’s existing footprint, especially in enabling mobile operators to roll out 4G services.

Meanwhile, the clearance of this deal also brings Idea-Vodafone a step closer to approval from the telecom regulator. Aditya Birla-led Idea Cellular is learnt to have put in an application for final DoT approval for its merger with Vodafone India, a person with direct knowledge told ET.

As per sources, DoT wanted to clear telecom tower deal between Idea, Vodafone and ATC before approving the Idea-Vodafone merger as a change in organisation structure would have created complexity in document work.

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Kaushik IMAKirti KhuranaChetan Recent comment authors
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Kaushik IMA
Kaushik IMA

By mid June we should be getting a press conference and announcement of merger. Let’s see.

Kirti Khurana
Kirti Khurana

But for what? ICR untill a year or two?

Kaushik IMA
Kaushik IMA

MergedCo acting as one administrative unit – ICR will probably be for a year or two like you said.

In the meantime they will integrate their backend and backhaul, fiber etc.

Data speeds should still improve in the ICR period due to this. But the real deal will be in 2019 I guess.

For most people coverage is still more important than raw speed. If they can manage to give all users 5-7 Mbps in all types of congestion under ICR it will still work out good in interim period.

Kirti Khurana
Kirti Khurana

After this June, would the merger co. allow any void user to use any network or only where one doesn’t offer 3G or 4G could only hook up to?

Kaushik IMA
Kaushik IMA

I believe one will be able to use either network by manual latching. But let’s see.

Chetan
Chetan

As per one source, DOT has also approved FDI to 100% for idea on Wednesday and now both Vodafone and idea has submitted merger application for final approval. It seems Kumar Mangalam Birla met Manoj Sinha on Wednesday to discuss final contours of deal. Final merger approval expected any moment may be first week of June

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