Vodafone Group gets nod for Indus Towers-Bharti Infratel merger

By: |
October 6, 2020 12:45 AM

The agreement to proceed was conditional on consent for a security package for the combined company from Vodafone’s existing lenders. The consent was regarding a 1.3 billion euro loan utilised to fund Vodafone’s contribution to the Vodafone Idea rights issue in 2019.

The parties are working to complete the transaction expeditiously.

UK-based Vodafone Group has said it has received nod from its lenders to proceed with the merger of Indus Towers with Bharti Infratel. Vodafone Idea holds 11.15% stake in Indus Towers, which is worth around Rs 4,000 crore.

Vodafone Group had announced on September 1 that it had agreed to proceed with the merger of Indus Towers and Bharti Infratel. The agreement to proceed was conditional on consent for a security package for the combined company from Vodafone’s existing lenders. The consent was regarding a 1.3 billion euro loan utilised to fund Vodafone’s contribution to the Vodafone Idea rights issue in 2019.

Vodafone in a statement said this consent has now been received. The parties will now approach the National Company Law Tribunal to make the merger scheme effective. The parties are working to complete the transaction expeditiously.

In April 2018, Bharti Airtel, Idea Cellular and Vodafone Group had announced an agreement for the merger of Indus Towers and Bharti Infratel. At that time, Vodafone and Idea Cellular were two separate entities and Indus Towers was jointly owned by Bharti Infratel (42%), Vodafone (42%), Idea (11.15%) and Providence (4.85%). Now, the 11.15% stake of Vodafone Idea (formerly Idea Cellular) is likely to be sold for a cash consideration of Rs 4,000 crore while Vodafone Group, is expected to stay invested in the merged entity with a likely shareholding of 28.2%.

The 42% stake of Vodafone in Indus Towers was not included in the merger of the two companies.

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