Bharti Airtel is in talks with Vodafone Plc to take an additional 3 per cent stake in Indus Towers, India’s largest mobile tower installation company. If the talks come to fruition, Bharti Airtel will have a controlling 52 per cent stake in the tower company, reported CNBC-TV18 citing anonymous sources.
Vodafone sold 18 per cent equity in Indus Towers in block deals for nearly ₹15,300 crore last week. After the block deals, Vodafone had a 3.1 per cent shareholding in Indus Towers.
Bharti Airtel bought a 1 per cent additional stake in Indus Towers in the block deal, taking its holding in the tower company close to 49 per cent. If the proposed deal goes through, Bharti Airtel will be the majority shareholder in Indus Towers with a 52 per cent stake.
Bharti Airtel also plans to merge its high-growth data centre business Nxtra with Indus Towers, as a part of its mega plan, a two-pronged strategy to consolidate its business, according to the CNBC-TV18 report. Indus Towers will need cash for the upcoming auctions while the funds from the deal can push expansion and growth for Nxtra.
Indus Towers has indicated that Vodafone’s total outstanding dues are nearly ₹5,400 crore. The report stated that Vodafone will use a large part of the deal’s proceeds to pay these dues.
The merger of the business would provide an exit to Carlyle, an American private equity firm that owns a 24 per cent stake in Nxtra, which it picked in 2020.
As the telecom sector looks at a series of tariff hikes and Indus Towers is India’s largest tower company, they will play a huge role in improving the health of the service providers in the industry, as per the report.
Bharti Airtel shares closed at Rs.1,419.20, rising 0.42 per cent on June 24.
Vodafone Group was looking to sell its entire $2.3 billion stake in Indus Towers as part of a strategic move to pare its hefty debt, Reuters reported.
The amount raised from the deal would be used to trim Vodafone’s significant $42.17 billion net debt, the Reuters report said. Back in 2022, Vodafone announced intentions to offload its then-28 per cent stake in Indus Towers, but progress had been slow until last week.
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Published: 24 Jun 2024, 05:27 PM IST