Vodafone Group Plc to sell 9.94% stake in Indus Towers for up to $1.1 billion

Morgan Stanley, BofA Securities, Jefferies, and BNP Paribas will manage the sale which is slated to open on Wednesday.

Britain's Vodafone Group Plc will sell a 9.94% stake in Indus Towers through a bulk deal at a price range of ₹310- ₹341 per share, valuing the transaction between $996 million and $1.1 billion, according to a term sheet seen by Mint.

Morgan Stanley, BofA Securities, Jefferies, and BNP Paribas will manage the sale which is slated to open on Wednesday.

Mint had reported on Tuesday that Vodafone Group Plc, which owns 21.5% through various entities in Indus Towers, is looking to sell its stake in the mobile tower provider. Private equity (PE) firm I Squared Capital and alternative investment firm Stonepeak were reported to be in the fray as buyers.

Indus Towers is India’s largest telecom tower provider with over 219,736 towers covering all 22 telecom circles. Bharti Airtel Ltd is the largest shareholder with a 47.95% stake. Reuters reported on 14 June that Vodafone Group was looking to sell its entire stake worth $2.3 billion through a block deal.

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According to the term sheet, Vodafone Group’s wholly-owned indirect subsidiaries Euro Pacific Securities Ltd, CCII (Mauritius), Inc, Asian Telecommunication Investments (Mauritius) Ltd, Trans Crystal Ltd, Mobilvest, Prime Metals Ltd, Vodafone Telecommunications (India) Limited and Al-Amin Investments Ltd will be selling 268,000,000 shares from their holdings. A carve out may be created for any bilateral arrangement for acquisition of shares of the company between the sellers and an existing promoter shareholder or its affiliates, whether through an on-market or off-market transaction, it added.

In 2022, Vodafone Group sold over 7% in Indus Towers, of which 4.7% was acquired by Bharti Airtel. The proceeds were routed to Vodafone Idea to reduce its debt. Currently, its debt stands at over ₹2.1 trillion.

The British telecom operator has pledged its stake in Indus Towers to settle the dues—estimated to be at around ₹10,000 crore—owed by its Indian arm Vodafone Idea to the mobile-tower operator. It is unclear whether the proceeds from this sale would be used for repaying Indus Towers’ dues.

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Vodafone Idea, a key Indus Towers customer, raised ₹18,000 crore in India’s largest follow-on public offer (FPO) in April. However, the telco's chief executive Akshaya Moondra said at the time that Vodafone Idea cannot use the proceeds to settle the dues of Indus Towers. While Indus Towers has asked Vodafone Idea to pay up its dues in full, Sunil Mittal, chairman of Bharti Airtel, has said Vodafone Idea should pay its past dues to Indus Towers, failing which services could be stopped.