American Tower Corp eyeing more tower assets

KOLKATA: American Tower Corp (ATC), which bought Vodafone India and Idea Cellular's 20,000-odd captive towers last month for $1.2 billion (Rs 7,850 crore), will explore more big-ticket tower asset acquisitions to grow operations in India, said James D Taiclet, chairman of the Boston-based telecom tower company.

"We do not comment on specific portfolios, but we would evaluate potential future opportunities to acquire additional assets that meet our return on investment (RoI) requirements to augment operations in India, which is our largest international market in terms of the number of towers," Taiclet, who is also ATC's global CEO, toldET. He was responding to ET's specific query on whether ATC would be keen to buy the 42% and 11.15% stakes that Vodafone and Idea separately own in Indus Towers, which is among the world's largest telecom tower companies and India's largest.

Vodafone India and Idea, the second and third-largest carriers that are in the process of merging their businesses to create the country's largest telco, are reportedly keen to monetise their Indus stakes. ATC's near-term focus, Taiclet said, would be integrating the captive towers recently acquired from Vodafone and Idea into its existing portfolio, but going forward, it may "seek to acquire additional assets in India depending on their characteristics and return potential," given the tower company's significant "financial resources, local market knowledge and experienced management team".

Over the past two years, the US telecom tower company has been bolstering its India towers portfolio, having bought a 51% stake in Viom Networks for Rs 7,635 crore in the largest inbound acquisition in FY16.

Last month's mega buyout of Vodafone India and Idea's captive towers will further boost ATC's India towers portfolio to nearly 80,000, taking it closer to market leader Indus and Bharti Infratel which command a portfolio of some 1,23,000 and 91,000 towers, respectively.

Taiclet said "India presents a compelling long-term growth opportunity for ATC" as its government is committed to bringing broadband to a majority of the country's 1.3 billion-plus citizens, coupled with the fact that "a much improved structural market framework" both in the wireless and tower sectors is likely to emerge after the current carrier consolidation process concludes. India's telecom industry, weighed down by nearly Rs 5 lakh crore of debt, has been battling fierce price competition sparked off by the disruptive entry of Reliance Jio over a year back. The stress has led to rapid-sector consolidation, which is slated to leave Airtel, the Vodafone-Idea Cellular combined entity and Jio as the only three strong private sector players.

The ATC chairman also expects the rapid consolidation underway in India's telecom towers space to ring in an era of independent tower companies, which would be "a net positive" for the country's entire towers industry.