Cell tower deal valued at $1.65B
Indian telecommunications firm Reliance Communications on Friday signed a nonbinding deal with asset manager Brookfield to sell a 51% stake in its cell tower business for 110 billion rupees ($1.65 billion).
Under the terms of the agreement, the stake in Reliance Infratel will be transferred into a separate special purpose vehicle, which will be owned by Brookfield.
The remaining 49% stake will be held by Reliance Communications, which will continue to be an anchor tenant on the cell tower assets under a long-term master service agreement.
The telecom said the proceeds from the sale of the network infrastructure will be used to reduce debt.
“Reliance Communications and Brookfield expect considerable growth in tenancies based on increasing 4G offerings by all telecom operators and the fast accelerating trends in data consumption, which are expected to contribute to significant growth in revenue and profitability for the towers business in the future,” the company said in a statement. “Reliance Communications and Brookfield also see several opportunities for consolidation in the towers industry in India that will further enhance growth and value creation in the future.”
Reliance also said that the agreement is subject to customary approvals.
Reliance Communications’ network infrastructure currently covers over 21,000 cities and towns and over 400,000 villages across India. The company also owns and operates a next-generation internet protocol-enabled connectivity infrastructure, comprising over 280,000 kilometers of fiber optic cable systems in India, the U.S., Europe, the Middle East and the Asia-Pacific region.
The Indian company has a customer base of more than 107 million, including over 2.6 million individual overseas retail customers. Reliance Communications’ corporate client base includes over 39,000 Indian and multinational companies.
BSNL to invest $375M in India within the next six months
Also in India, state-controlled telco Bharat Sanchar Nigam plans to invest around 25 billion rupees in the second half of its fiscal year, which ends March 2017, local press reported.
Most of the planned investment will be used to strengthen the company’s core network, expanding its Global System for Mobile communication coverage and the installation of additional Wi-Fi hot spots.
The telco expects to deploy 20,000 new base transceiver stations in a move to improve the quality of its mobile service. BSNL also announced plans to deploy 40,000 Wi-Fi hot spots by the end of 2018. The telco currently has 2,700 active hot spots across India.
