TowerVision India, an independent telecom tower company owned by US PE firm Quadrangle and Israeli investor Fore Group along with other investors, is considering selling some operations, according to local reports.
A potential deal could fetch as much as…
TowerVision India, an independent telecom tower company owned by US PE firm Quadrangle and Israeli investor Fore Group along with other investors, is considering selling some operations, according to local reports.
A potential deal could fetch as much as US$700m and several companies, including American Tower Company (ATC), Indus Towers and GTL Infrastructure, might be among the potential bidders, the Business Standard and the Times of India wrote.
The company reportedly has 6000 towers but is looking to increase this number to 10,000 looking ahead. Barclays is advising TowerVision on its strategic options, explained the newspapers.
TowerVision’s exit considerations have reportedly been triggered by the financial difficulties of the US PE firm, which is looking to sell down some investments following kickback scandals a few months ago, wrote the Times of India.
A potential sale would fit in with ongoing rumours of consolidation in the Indian tower market. “Operators have come to the realisation that redundant infrastructure is not an advantage. Hence, there’s going to be more tower and other infrastructure sharing in the months ahead. We may well see some consolidation in tower companies as they seek scale,” said Jonathan Dharmapalan, global deputy telecommunications leader at Ernst & Young, to TelecomFinance in a previous report.
But valuation issues have acted as deal breaker in some cases. In September, GTL Infrastructure stated that its US$11bn merger with the Reliance Infratel towers business had been scrapped, with valuation differences assumed to be the culprit.
However, “mobile operators are increasingly opting out of the tower and passive infrastructure business so there is definitely room for two-to-three ‘national’ tower companies in the future whether operator-owned (like Indus) or independent (like GTL),” Shiv Putcha, a principal analyst, emerging markets, at Ovum, told TelecomFinance a few weeks ago.
TowerVision and Quadrangle could not be reached for comment before going to press.
