New Delhi : Bharti Infratel and Indus Towers are likely to invest Rs 3,500 crore in operations as capital expenditure for 2018-19 as they continue to operate on ‘business-as-usual’ mode till their merger happens before the fiscal-end, sources said.
The two companies last month announced a merger deal that will create a $14.6 billion firm with world’s second-largest number of mobile masts. The merged entity will have, in its fold, more than 1,63,000 towers across India – largest after China Tower.
A source privy to the development said the annual financial planning continues on course for both the companies as it is ‘business-as-usual’, and that Infratel’s capex is expected to be in the ballpark range of Rs 1,200 crore in 2018-19. Similarly, Indus Towers, where Infratel holds a 42 per cent stake, is likely to infuse roughly Rs 2,300-2,500 crore as capex this year, said the official who did not wish to be named.
Indus Towers is jointly owned by Bharti Infratel (42 per cent holding), Vodafone (42 per cent), Idea Group (11.15 per cent) and Providence (4.85 per cent).
The amount of investment is similar to last year’s levels and will go into “new towers, tenancies and replacement capital”, the official said adding that the investments are being funded from internal accruals of the two tower firms.
A Bharti spokesperson declined to comment on a detailed e-mailed query sent to the company. Indus Towers did not wish to comment.
“The capex amount will also be used for replacement of batteries, DG (diesel generators), power equipment…As the tenancies increase, the two companies will continue to increase their capacities of mobile towers ahead of their proposed merger,” said the source.
Last month, the two entities announced that, “Indus Towers will be merged with and into Bharti Infratel through a scheme of arrangement.” The merged entity, which will be called Indus Towers, will remain listed.