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GTL to buy Aircel's towers for 
4000 Crore
By siliconindia
|
Thursday, 24 December 2009, 17:35 IST
Mumbai/New Delhi: GTL Infrastructure, which leases out towers to cell phone operators, will soon buy Aircel's towers for 
4,000 crore in an all-cash deal, a valuation lower than for similar deals in the past, a sign of the diminishing investor interest in telecom, reports Economic Times.
GTL beat Tata-Quippo in the negotiations to buy the 17,500 towers of Aircel, taking its total to 33,000 and giving it access to another 20,000 that are being set up, said two people familiar with the development who did not want to be identified.
The enterprise value of the deal may be around 8,500 crore, including a debt of 4,500 crore. Malaysia's Maxis Communications holds 74 percent in Aircel. The deal may be funded out of internal accruals of the GTL group, said the person.
"Along with the towers, GTL will acquire the related broadband infrastructure as well," the person privy to the discussions told Economic Times. "We have not yet concluded the deal," said Aircel CEO Gurdip Singh. "The process is still underway and we are in talks with three parties." He however did not disclose the other two.
Investor interest in India's telecom sector,has been on the downside. Tariff war in the sector has resulted in analyst downgrades of stocks, which have been the worst performers this year, even as the benchmark stock indices are on course for record gains.
"Going by past deals, GTL has bagged Aircel towers at a fair valuation," said a sectoral Analyst who wished to remain anonymous. "It's not a stretched deal compared to the prices at which Bharti and Reliance Communications sold their towers. Plus, GTL will have Aircel as anchor tenant."
4,000 crore in an all-cash deal, a valuation lower than for similar deals in the past, a sign of the diminishing investor interest in telecom, reports Economic Times.
GTL beat Tata-Quippo in the negotiations to buy the 17,500 towers of Aircel, taking its total to 33,000 and giving it access to another 20,000 that are being set up, said two people familiar with the development who did not want to be identified.
The enterprise value of the deal may be around 8,500 crore, including a debt of 4,500 crore. Malaysia's Maxis Communications holds 74 percent in Aircel. The deal may be funded out of internal accruals of the GTL group, said the person.
"Along with the towers, GTL will acquire the related broadband infrastructure as well," the person privy to the discussions told Economic Times. "We have not yet concluded the deal," said Aircel CEO Gurdip Singh. "The process is still underway and we are in talks with three parties." He however did not disclose the other two.
Investor interest in India's telecom sector,has been on the downside. Tariff war in the sector has resulted in analyst downgrades of stocks, which have been the worst performers this year, even as the benchmark stock indices are on course for record gains.
"Going by past deals, GTL has bagged Aircel towers at a fair valuation," said a sectoral Analyst who wished to remain anonymous. "It's not a stretched deal compared to the prices at which Bharti and Reliance Communications sold their towers. Plus, GTL will have Aircel as anchor tenant."
