American Tower Corporation (ATC) said on Thursday that its subsidiary has completed the acquisition of around 9,900 standalone telecom towers of Idea Cellular for Rs 4,000 crore. “This transaction expands our presence in Central, North and Northeast India (Assam, Bihar, Himachal Pradesh, Madhya Pradesh, North East, Orissa and Jammu & Kashmir circles, among others), under served areas in which we expect substantial future 4G-focused investments,” ATC’s executive VP and president (Asia) Amit Sharma said. In November last year, Vodafone India and Idea inked an agreement with ATC subsidiary ATC Telecom Infrastructure Pvt Ltd (ATC TIPL, formerly Viom) to sell their standalone towers for an enterprise value of Rs 7,850 crore, or roughly $1.2 billion.
As part of the deal, Idea was to sell its entire stake in ICISL and Vodafone India was to sell a business undertaking to ATC TIPL. The deal was expected to be closed by June 2018. Last week, the department of telecom (DoT) approved the sale of Idea’s towers to ATC TIPL. In a separate statement, Idea said post completion of the merger of Vodafone and Idea, around 6,300 co-located tenancies of both operators on the combined standalone tower portfolio will collapse into single tenancies over a period of two years without the payment of exit penalties.
Both as customers, and ATC as a vendor, have agreed to treat each other as long-term preferred partners, subject to existing arrangements. “The receipt of both these proceeds prior to completion was anticipated and provided for, in the Vodafone and Idea merger agreement and hence would not affect the agreed terms of merger, including the amount of debt which Vodafone will contribute to the combined entity at the closing of merger transaction,” it added.
ATC has already completed the acquisition of Vodafone’s 10, 235 standalone towers in April for Rs 3,850 crore. This also brings Idea and Vodafone a step closer to their proposed merger, which now awaits clearance from the DoT. The merger has been cleared by the stock exchanges, Sebi, CCI and the NCLT.