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Vodafone, Airtel in talks with KKR for stake sale in tower venture

May 02, 2019
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Vodafone Group Plc and Bharti Airtel are in talks with a consortium led by private equity firm KKR to reduce their stakes by over half in the company that will be created by the merger of Bharti Infratel and Indus Towers.

According to industry sources, Airtel and Vodafone are planning to reduce their stakes to around 13 per cent each in the merged entity, which is being valued at $12-13 billion. This would allow the two companies to exercise certain rights such as veto powers over signing and terminating contracts with clients, among others. However, the Vodafone Group is expected to eventually exit the tower company.

If the merged entity is valued at $13 billion, Bharti Airtel could raise about $3.2 billion by reducing its stake from over 37 per cent to 13 per cent. Meanwhile, the Vodafone Group could raise around $2.1 billion by reducing its holding from over 29 per cent to 13 per cent.

The merger of Bharti Infratel and Indus Towers is set to come up for approval at the National Company Law Tribunal on May 14, 2019.

 
 
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