New Delhi: The Department of Telecommunication (DoT) on Friday approved the merger of Indus Towers, the country’s largest mobile tower company with Bharti Infratel. Official sources gave this information.
The combined company, formed after the merger, will have more than 1,63,000 telecom towers across the country, operating in all 22 telecom service areas. The combined company formed by the merger will be the world’s largest tower company except China.
The name of this joint company will now be changed to Indus Towers Limited and the company will continue listing on the domestic stock exchanges. The company will have full ownership of the business of Bharti Infratel and Indus Towers.
Timely completion of this deal is very important, as it will open options for Bharti Airtel and Vodafone Idea to raise money by selling their stake in the company.
Bharti Infratel and Vodafone Group currently hold 42-42 per cent stake in Indus Towers. Vodafone Idea also holds 11.15 percent stake in it. Airtel holds a very large stake in Bharti Infratel.
It is believed that Vodafone Idea will be able to raise about Rs 4500 crore from this deal. This amount will be used by the company to pay AGR arrears. The company owes AGR of about Rs 52000 crore.
According to the term of the deal in 2018, Vodafone Idea will exit by selling shares in the new company. Later, Bharti Airtel will have 37.20 per cent stake and Vodafone Group will hold 29.40 per cent.
The agreement was signed between Bharti Infratel and Indus Tower on 23 April 2019. The deal was not yet approved by DoT.
