Tata Teleservices Ltd (TTSL) has merged its tower business with Quippo Telecom Infrastructure Ltd, a company promoted by the Kanorias of SREI Infrastructure Finance Ltd. Quippo will pay around Rs 2,400 crore in cash to Tata Teleservices, and transfer its 5,000 telecom towers to Wireless-TT Info-Services Limited (WTTIL), the tower arm of TTSL.
While Quippo will have management control of the new company with a 49 per cent stake, TTSL will own the remaining 51 per cent. Quippo’s existing investor base includes GIC Singapore (owned by the Singapore government), IDFC Private Equity and Oman investment Fund (OIF).
The combined entity will have a portfolio of over 18,000 towers, making it the largest independently managed tower company in India, with an enterprise valuation of approximately Rs 13,000 crore ($2.6 billion), said the release. “This alliance will allow TTSL to concentrate on its core area of expertise,” said Anil Sardana, managing director, TTSL.
The company has set a target of over 50,000 towers by Year 2012, said a joint release from the companies, quoting Arun Kapur, managing director, Quippo Telecom.
The management rights in WTTIL shall now move over to the independent & professional management run by Quippo Telecom, to make it an independent tower operator without being managed by a Telecom company.
The financial advisers of the partnership are Citi and Nomura for TTSL and JM Financial for Quippo Telecom.