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Vodafone-Essar to sell off its remaining tower business news
04 November 2010

Telecom major Vodafone-Essar, India's second-largest operator on the GSM platform, has decided to unlock value by selling its tower business to an independent tower company after demerging it, according to several unconfirmed reports.

The companies which are said to be in the fray to take over the tower business of Vodafone Essar include GTL Infra and Tata Quippo. Others like SREI Infrastructure and American Tower Corp have also been mentioned.

Vodafone Essar has about 7,000 towers in six circles, including Bihar and the North-east, with a total tenancy estimated at 9,000. Various reports put their valuation at between Rs3,000 crore and Rs5312 crore. The last deal in the sector, GTL's takeover of Aircel's tower business, was valued at around Rs40 lakh per tenant.

Interestingly, in a board meeting on Tuesday, GTL Infrastructure passed a resolution to raise Rs1,500-2,000 crore by way of equity or quasi-equity. This could very well be used for the acquisition.

Vodafone refused to comment officially, but is said to have appointed Barclays Capital as its advisor.

The bulk of Vodafone's telecom towers has already been hived off into Indus Towers, a separate company, which is a three-way venture between Bharti Airtel, Vodafone-Essar and Idea Cellular. Indus is the country's largest tower company with over 1,00,000 towers. Vodafone holds 42 per cent in Indus, Bharti 42 per cent, and Idea 16 per cent.





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Vodafone-Essar to sell off its remaining tower business