Vodafone India besides going through a merger with Idea Cellular has also made a deal with ATC‘s (American Tower Corporation) Indian subsidiary under which ATC will acquire Vodafone’s tower business which boasts of owning 10,200 communication sites. This deal between both the parties has been finalised for Rs 3800 crores. ATC’s idea of merger sprouted in the news when the American company announced its plan of buying out the towers of now merged entities, Idea Cellular and Vodafone, in November last year.
This new step was beneficial for all the sides as the selling telcos would receive major help in filling their debts and on the other hand ATC will get to own a substantial number of towers in a country which happens to be in the middle of a splurging growth in the telecom sector.
Amit Sharma, American Tower’s EVP and President, Asia said about the successful buyout “We are pleased to acquire this portfolio, which will complement our existing footprint and help us serve our tenants in India as they expand 4G services in the coming years."
Idea Cellular is expected to receive a sum of approximately Rs 4,000 crores from the selling of its tower in this deal. This amount is expected to strengthen Idea Cellular financially.
Vodafone also made a statement about this buyout saying "In the Vodafone India / Idea merger announcement of 20 March 2017, both parties announced their intention to sell their individual standalone tower businesses to strengthen the combined financial position of the merged entity. The merger is expected to complete in the first half of the current calendar year."
Once the merger finishes, Vodafone and Idea will form India's leading telecom operator with over 400 million subscribers and the merged entity will be the leader in the revenue market share as well.