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Four shortlisted for Aircel tower sale
By siliconindia
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Friday, 07 August 2009, 20:48 IST
Bangalore: Aircel Cellular has shortlisted four firms including U.S. based American Tower Corporation (ATC) and Bharti Infratel for buying out its tower business in a deal worth $1.5-2 billion, according to sources familiar with the development. The other two companies are Crown Castle International and Tata-Quippo.
The company is looking to offload 51 to 100 percent of its tower business. The shortlisted firms will have access to Aircel's books, starting next week to begin due diligence, reports The Economic Times. This implies that Reliance Telecom Infrastructure (RTIL), the tower arm of Reliance Communications, and GTL, the country's largest standalone tower company has failed to make the cut.
Malaysia's Maxis Communications, which has a majority stake in Aircel, had appointed Standard Chartered, Nomura and Rothschild as investment bankers to sell a majority stake in its business unit with 12,000 plus towers.
A top executive with a tower company that has put in a bid had earlier said that he would expect Aircel's towers to be valued at about 
46-48 lakh per unit, far lesser than Tata Teleservices tower arm Wirless Tata Telecom Infrastructure's (WTTI) merger with Srei group company Quippo Telecom Infrastructure (QTIL) in December 2008, where the deal valued each tower at over 70 lakh. But this is in line with the recent deal where ATC had bought Xcel Towers which had 1,660 towers and the deal valued each tower at just over 46 lakh.
Another executive aware of the developments said that due diligence would take about four to six weeks, following which, all the four shortlisted bidders would have to submit binding bids and consequently the short-listing process will take place.
Aircel is the only telecom among major operators that has not demerged its towers into a separate entity. All large telecom operators, including Bharti Airtel, Vodafone Essar, RCOM and Idea Cellular, have demerged their towers and physical infrastructure into separate entities.
According to industry executives, Aircel, which has over 21 million customers, plans to sell its towers, as it requires funds for its $5 billion expansion plan to become a pan India operator by the end of 2010. Aircel will also require additional resources if it were to bid for the upcoming 3G spectrum auctions.
46-48 lakh per unit, far lesser than Tata Teleservices tower arm Wirless Tata Telecom Infrastructure's (WTTI) merger with Srei group company Quippo Telecom Infrastructure (QTIL) in December 2008, where the deal valued each tower at over 70 lakh. But this is in line with the recent deal where ATC had bought Xcel Towers which had 1,660 towers and the deal valued each tower at just over 46 lakh.
Another executive aware of the developments said that due diligence would take about four to six weeks, following which, all the four shortlisted bidders would have to submit binding bids and consequently the short-listing process will take place.
Aircel is the only telecom among major operators that has not demerged its towers into a separate entity. All large telecom operators, including Bharti Airtel, Vodafone Essar, RCOM and Idea Cellular, have demerged their towers and physical infrastructure into separate entities.
According to industry executives, Aircel, which has over 21 million customers, plans to sell its towers, as it requires funds for its $5 billion expansion plan to become a pan India operator by the end of 2010. Aircel will also require additional resources if it were to bid for the upcoming 3G spectrum auctions.
