Tata to Sell Tower Stake

Tata Teleservices Ltd. is the latest Indian operator planning to sell off a stake in its mobile tower infrastructure unit.

The carrier, which runs a CDMA network in 20 of India's 23 circles, is in talks with around 15 companies to sell between 26 and 49 percent of its tower business, called Wireless-TT Infoservices (WTTIL).

The unit manages 10,000 towers for Tata Teleservices, and another 3,500 for Tata Teleservices (Maharashtra), its publicly listed subsidiary that operates in the Maharashtra and Mumbai circles.

Ovum Ltd. 's Fernanda Mello Veiga writes in an analyst note that "American Corporate Corporation" [sic] and Crown Castle International Corp. (NYSE: CCI) "may be participating in this bid," which is expected to be completed by May.

Most of India's mobile operators have made moves to spin off their passive infrastructures into separate companies to facilitate infrastructure sharing and save on costs. (See Indian Operators in Sharing Mood.)

That strategy has the added bonus of allowing them to sell off stakes in those companies to investors that are keen to get a piece of the action in India's booming mobile market.

Last December Bharti Infratel, the tower unit of Bharti Airtel Ltd. (Mumbai: BHARTIARTL), sold a stake worth $1 billion to a group of international firms including Temasek Holdings Pte. Ltd. , Goldman Sachs & Co. , Macquarie Bank , and Citigroup . (See Bharti Sells Tower Stake.) It followed that up in February by netting an investment of $250 million from private equity firm Kohlberg Kravis Roberts & Co. (KKR) . (See Bharti Infratel Gets $250M.)

Reliance Communications Ltd. (RCom) sold a 5 percent stake in its tower unit in July 2007 to a group of international investors for $350 million, and has filed for an IPO that will see it selling a 10.05 percent share of the company. (See Reliance Sells Tower Stake and Reliance Infratel Files for IPO.)

— Nicole Willing, Reporter, Light Reading

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