Tata Teleservices reportedly set to pay $900m compensation to American Tower
30 May 2018 | James Pearce
Tata Teleservices is set to pay $900 million to American Tower Corp as compensation for winding up around 30,000 tenancies, according to reports in India.
Reports from The Economic Times claimed potential payment, which would come after Tata Teleservices agreed to sell its mobility arm to Bharti Airtel, would help push through the deal.
According to an ET source, the overall compensation will include Tata Teleservices’ 26% stake in Viom Networks, which is controlled by ATC.
In October 2017, Bharti Airtel announced plans to buy TTSL’s consumer mobile business in a debt-free cash-free deal, with Bharti paying for TTSL’s unpaid spectrum liability. The deal received approval from the Competition Commission of India in November, with the liabilities to ATC one of the outstanding issues that needs to be agreed.
The ET story claims that ATC was originally looking for around $1 billion in overall compensation due to the nature of the tenancy agreements, which were based on long-term deals valid until 2025. These also included 5-7 year lock-ins, the report claims.
The potential agreement marks the latest in a series of moves in the Indian towerco market. American Tower recently struck a deal to buy Vodafone’s Indian tower unit in a deal worth €478 million, adding 10,200 towers to its portfolio. In a separate deal, it agreed to buy Idea Cellular’s 8,886-strong tower business ahead of the latter’s merger with Vodafone India.
Bharti’s tower unit, Bharti Infratel, is also set for a mega merger with Indus Towers that would create the second largest tower company in the world, with over 163,000 towers operating across all 22 Indian telecoms circles.
12h | Alan Burkitt-Gray
12h | James Pearce
12h | James Pearce
13h | Alan Burkitt-Gray