Bharti Airtel today confirmed that it will buy 4.7 percent stake in Indus Towers, India’s leading telecom tower company, from Vodafone Group.
Vodafone is planning to sell a portion of its stake — 7.1 percent — in Indus Towers to support Vodafone Idea’s (Vi) efforts to strengthen its balance sheet. Vi is struggling to make rentals to Indus Towers and hence a deal will assist Airtel as well.
Airtel did not reveal financial details of the deal.
Media is speculating that the total sale of 7.1 percent could fetch Vodafone in the range of Rs 4,328 crore-Rs 4,405 crore. Of this, the sale to Bharti Airtel could fetch around Rs 2,885-2,936 crore, and the block sale around Rs 1,443-1,469 crore.
The purchase would be at an attractive price representing a significant discount typically available for such large block transactions, Airtel said.
Airtel in a news statement said the condition for the telecom tower deal is that the amount paid should be inducted by Vodafone as fresh equity in Vodafone Idea and remitted to Indus Towers to clear Vi’s outstanding dues.
Airtel will be protected with a capped price which is lower than the price for the block of Indus Towers shares sold by Vodafone on February 24, 2022. This shall be value accretive to Bharti Airtel and protect its existing significant shareholding in Indus Towers.
Indus Towers is the country’s largest tower infrastructure provider with a portfolio of over 1,84,748 telecom towers across all the 22 telecom circles.
While Vodafone Idea exited its investment in Indus Towers in 2020, it continues to be tenant in it but has not been able to pay rentals as per the agreement. Indus Towers said in a statement on Wednesday that VIL has committed to pay certain amounts each month till July.
