India Telecom Tower Buzz

Moving to more realistic valuations given a current tenancy ratio of just over 1 !

by VCCircle

The telecom tower sector has gone through a major consolidation in the last two months. American Tower Corporation this week announced the acquisition of Essar Telecom Infrastructure Private Limited (ETIPL), an arm of Essar Group which has 4,450 tower sites. The all cash deal gives ETIPL an enterprise value of approximately Rs 2,000 crore, making it the largest M&A transaction in February. The deal comes after the recent Rs 8,400-crore buyout by GTL Infrastructure Ltd of telecom tower assets of Aircel Ltd. The per tower valuation also seems to have settled as both Essar-ATC and GTL Infra-Aircel deal value each tower at around Rs 45-50 lakh. As India gets ready for 3G and WiMax, these tower players will compete with other independent players like Tata Quippo (formed by merger of Wireless TT Info-Services Ltd's (WTTIL) with Quippo Telecom) and Towervision, which is armed with fresh PE funding from Quadrangle.