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   Effect of Tenancy on Telecom Mergers

    Indus Towers- Bharti Infratel merger, expected to be completed by late 2019, is set to create the world second-largest mobile tower operator, with over 163,000 towers and 36% tower market share in India.

·       The consolidation wave has reduced the number of players to about 5 as of 2019, from around 15 players in 2012.

·       For instance, the recent merger of Vodafone and Idea has resulted in over 557,000 tenancy losses.

·       A further reduction of about 21,000 tenancies is expected in the first half of fiscal 2020.

·       For instance, last year, Vodafone and Idea sold around 20,000 stands alone towers to American Tower Corporation (ATC) for Rs 78 billion.

·       Recently, ATC has acquired Tata Teleservices Limited’s residual stake of around 13% in ATC Telecom Infrastructure for Rs 25 billion.

·       Post merger, Vodafone Idea has the option to sell its 11.15% stake in Indus, which has an implied value of Rs 62 billion in cash at completion.