Bharti Infratel, on Saturday, said it has received FDI approval from the Department of Telecom (DoT) for merger with Indus Towers. The tower arm of Bharti Airtel said that its board will meet on February 24 to chart out its merger with peer Indus Towers Ltd.
"...FDI approval for merger of Indus Towers with Bharti Infratel has been received late evening yesterday," Bharti Infratel said in a regulatory filing.
With this merger, the new entity (Bharti Infratel and Indus Towers together) will become the largest tower company in the world outside China. The new entity will create a pan-India tower company with over 163,000 towers, operating across 22 telecom service areas.
Bharti Infratel had said in a presentation that the new entity would have a turnover of more than Rs 25,000 crore, controlling more than a third of the tower industry in the country. It also stated that it might save close to Rs 560 crore annually.
Bharti Infratel and Indus Towers have overlapping operation in four circles - Haryana, Uttar Pradesh and Rajasthan.
Indus Towers is a joint venture between Bharti Infratel, UK-based Vodafone Group Plc and Vodafone Idea. Bharti Infratel and Vodafone hold 42 per cent stake each in Indus. Vodafone Idea holds 11.15 per cent stake and the remaining 4.85 per cent is with private equity firm, Providence. Airtel has a majority stake in Bharti Infratel.
As per the plans, the combined company, which would fully own the respective businesses of Bharti Infratel and Indus Towers, would change its name to Indus Towers Ltd and will continue to be listed on Indian stock exchanges.
This latest development can help Bharti Airtel and Vodafone Idea that collectively owe over Rs 80,000 crore in adjusted gross revenue dues to the government. Both Bharti Airtel and Vodafone Idea may raise funds by divesting their stakes in the merged entity to pare debt
The Bharti Infratel and Indus Towers merger deal was signed last year in April.
(Edited by: Mansi Jaswal)