Tata, Quippo Merge Towers

Merger of their passive infrastructure businesses to create India’s largest independent telecom infrastructure company

January 6, 2009

2 Min Read

NEW DELHI -- Tata Teleservices Limited, the country’s youngest and fastest-growing pan-India telecom service provider, and Quippo Telecom Infrastructure Limited sponsored by Kanoria’s of SREI Infrastructure Finance Limited, today announced the merger of their passive infrastructure businesses to create India’s largest Independent Telecom Infrastructure Company.

Under the terms of this strategic partnership, Tata Teleservices Limited and Quippo Telecom will swap 51 per cent and 49 per cent stake, respectively, in the infrastructure business held by them. The management rights in Wireless-TT Info-Services Limited (WTTIL)—the tower arm of Tata Teleservices—shall now move over to an independent & professional management run by Quippo Telecom, to make it a truly independent tower operator without being managed by a Telco.

Quippo will make an upfront cash payment of approx 2400 Crores, as also transfer its passive telecom tower portfolio of approximately 5,000 towers to WTTIL. The combined entity will, therefore, have a portfolio of over 18,000 towers thereby making it the largest independently managed tower company in India, with an enterprise valuation of approximately Rs 13,000 crore (US $2.6 Billion).

“The deal is of strategic importance and value enhancing for all stakeholders—particularly so since it combines the proven expertise of management and operational capabilities of Quippo with the committed support of TTSL. Also, the Independent Board would ensure high standards of Corporate Governance and a business Code of Conduct same as what is followed at various Tata companies” Mr Anil Sardana, Managing Director of Tata Teleservices Limited, said.

“This partnership makes for perfect fit—Quippo is one of the most professionally-managed companies in this space and WTTIL is at the epitome of corporate governance. Furthermore, this alliance will allow TTSL to concentrate on its core area of expertise. Together, we will enhance the value proposition and shareholder value. The combined enity will reap the benefits of significant synergies through the merger, both at the operational and financial levels. This will help further increase the scale and reach of the entity, while ensuring better asset utilization, an upside in tenancy and reduction in capital expenditure,” he added.

Tata Teleservices Ltd.

Quippo Telecom Infrastructure Ltd.

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