UK’s Vodafone Group Plc is in advanced talks with American Tower Co (ATC), Crown Castle International, Brookfield and other long-term sovereign and pension money managers to sell its remaining 21% stake in Indus Towers through block deals, three people aware of the matter told ET.
Vodafone’s residual stake of 567.2 million shares in Indus Towers is valued at about Rs 11,571 crore, based on the tower company’s Rs 55000 crore market capitalisation at BSE on Tuesday.
Vodafone, Vi, ATC, Crown Castle and Brookfield declined to comment on ET’s queries till press time.
Once Vodafone sells its stake in Indus Towers, it will mark the British telco’s exit from the passive telecom infrastructure business in India.
Indus Towers shares closed at Rs 204 on the BSE on Tuesday, 2.51% higher than the previous close. Vi’s shares ended 3.76% higher at Rs 9.94.
People aware of the matter said Vodafone has hired Bank of America and Morgan Stanley for the proposed share sale, which could either be in a single or multiple tranches and to one or more investors.
Bank of America and Morgan Stanley did not comment.
Bankers are awaiting relatively stable market conditions to launch the share sale in Indus Towers. But Vodafone is keen on closing the deal in the first quarter of the next financial year, said the people.
Analysts said the unfolding geopolitical scenario, amid Russia’s ongoing invasion of Ukraine, and the consequent market situation would be key factors determining the timing of Vodafone’s residual stake sale in Indus Towers.
Vodafone recently said it was talking to several interested parties to sell its stake in Indus Towers.
“Multiple block deals are the most preferred option that banks have suggested instead of going ahead with a single strategic acquirer,” said one of the persons involved in the discussion, who did not wish to be identified.
Another person said that if negotiations with strategic investors such as ATC or Crown Caste advance, Vodafone could sell as much as half of its (residual) 21% holding to them.
Vodafone will only have a maximum of about Rs 1,000 crore available for any further equity infusion into its local telecom joint venture, Vodafone Idea (Vi), since it had pledged part of its Indus Towers stake worth Rs 11,000 crore with lenders to fund its contribution to Vi’s rights issue in 2019.
Of its initial 28.1% stake in Indus Towers, Vodafone Group recently sold 2.4% to unnamed investors via a block deal and is set to conclude a follow-up sale of another 4.7% in the tower company to Bharti Airtel, the largest shareholder of Indus. This would leave it with a 21% stake in Indus Towers.
Last week, Vi’s board cleared a plan to raise Rs 4,500 crore from its promoters – Vodafone UK and India’s Aditya Birla Group — via a preferential allotment and an additional Rs 10,000 crore from external investors as it aims to revive operations to compete effectively with Reliance Jio and Bharti Airtel.
