Bharti Airtel and Vodafone will jointly control the merged company, to be called Indus Towers Ltd, with equal board representation.
Bharti Airtel may likely trim down its stake in the company emerging from the merger of Indus Towers into Bharti Infratel, reported The Economic Times.
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According to the report, the company emerging from the merger will be the second largest telecom tower company in the world with a value of $14.6 billion. The report said that Bharti Airtel and Vodafone will jointly control the merged company, to be called Indus Towers Ltd, with equal board representation.
With Idea, a stake holder in Indus having an option to take up stake in the new company or sell its shares Bharti Airtel could end up owning either 37.2% or 33.8% stake in the new company, the report said. This could be higher than the stake held by Vodafone that could end up being an issue of contention in the future, as per the report. This in turn could prompt Bharti Airtel could sell a part of its stake in the company, according to the report.
“We wouldn’t be surprised if Bharti equalises the shareholding (with Vodafone) quickly by selling (the) surplus 8% stake…we continue to believe that cash requirements at the telecom business will force telcos to trim their stake in BHIN (Bharti Infratel) over time,” stated a Credit Suisse note quoted in the report.