I Squared Capital likely to acquire minimum 51 per cent stake in ATC’s India unit for $1.5-$2 billion

US-based I Squared Capital is likely to acquire a minimum of 51 per cent stake in American Tower Corporation (ATC) India unit, ATC Telecom Infrastructure Private Limited (ATC TIPL), for an enterprise value of around $1.5-$2 billion. The two parties have reportedly entered into a 60-day exclusivity agreement for bilateral negotiations for the acquisition.

The final deal size will depend on the commercial terms and the quantum of stake that I Squared Capital eventually buys in the company. As per industry sources, ATC is pegging the enterprise value of its India unit at around $3.5-$4 billion, largely based on a valuation of its strong towers portfolio of 77,128 towers in the country at roughly $40,000-$50,000 each. However, bidders are driving a significant bargain on the value amid continuing pressure around the sustainability of tenancy revenue inflows in future, given the stressed financial condition of Vodafone Idea Limited, which is ATC’s biggest customer in India.