CCEA approves ATC's acquisition of 51% in Viom Networks for Rs5,856 cr
07 April 2016
The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved American Tower Corp's acquisition of 50-per cent stake in Viom Network for Rs5,856.5 crore.
The CCEA, chaired by Prime Minister Narendra Modi gave its approval to the proposal of ATC Asia Pacific Pte Ltd Singapore for acquisition of 51 per cent of shareholding in Viom Networks Limited by way of transfer from existing shareholders.
The approval would result in a total foreign direct investment inflow of Rs5,856.51 crore into the telecom infrastructure of the country, which will spur economic growth, besides fostering inclusiveness and equity, says a finance ministry release.
American Tower's acquisition of majority stake in Viom Networks will make the Boston-based tower infrastructure firm a billion-dollar player in the Indian telecom sector.
ATC will own 56,000 towers in India, making it the largest operations for the company, overtaking its US business where it manages around 40,000 towers.
American Tower Corp will effectively own 65 per cent in a combined entity post-merger of ATC India and Viom, reports quoted James Taiclet, its chairman, president and CEO as saying.
The Tata group will own 26-per cent once the deal, the largest inbound acquisition so far this fiscal year, closes.
ATC hopes to buy the remaining stake in Viom when its partners wished to exit.
The deal, which was announced in October 2015, includes SREI Infra's entire stake of 18.5 per cent. SREI will get about Rs3,000 crore from the Viom sale.
Funds from the deal will help SREI deleverage and grow its core business, reports quoted Viom vice chairman Sunil Kanoria as saying.
ATC, which entered the Indian market in 2007, is now looking to build scale to ride on the telecom operators' need for more tower sites for 3G and 4G roll out.