Malaysian telecom firm Axiata may increase its presence in the Indian market by picking up stakes in tower assets.

Several Indian telecom operators, including Idea Cellular and Vodafone are looking to divest their tower assets in a bid to focus on the core business. Axiata’s telecom infrastructure subsidiary, edotco, is one of the largest tower companies in the region with investments in Bangladesh, Sri Lanka, Myanmar and Cambodia.

According to industry sources, Axiata may have initiated talks with Indian operators for a possible acquisition.

The Malaysian operator currently has a minority stake in Idea. But with Vodafone and Idea announcing the merger of their mobile service operations, Axiata’s stake in the combined entity will come down further.

When contacted, an Axiata spokesperson said, “The Group is currently engaged in analysing all potential impact on Axiata arising from the proposed merger. The Group’s assessment of its position as a minority shareholder of Idea will be an extension of Axiata’s ongoing evaluation and analysis of its investment portfolio in its entirety. “Axiata’s next course of action, if any, will be based on the outcome of a comprehensive analysis based on the principles above which will maximise the benefits to the shareholders of Axiata.”

According to industry experts, with mobile operators exiting the tower segment, private equity players and pure-play tower operators are expected to control the infrastructure. “American Tower Corporation is already emerging as a big pure-play tower firm. Axiata has a strong regional presence and so may find India’s tower sector attractive. This apart, we will see private equity players such as Brookfields and KKR running tower operations,” said an industry expert.