The Indian telecom market is growing rapidly and has more than 809,000 towers, with an annual growth rate of 7%.
KKR & Co, Stonepeak Partners and Macquarie Capital are reportedly in talks with merchant bankers over a possible investment in Ascend Telecom Infrastructure Private Ltd, India’s third-largest telecom tower company, according to a report by Mint.
This comes after the investment funds failed to acquire American Tower Corp’s assets in India, which passed into the hands of the Canadian Brookfield.
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The report cites sources saying investment firms are eager to start talks with Ascend, which is wholly owned by US-based Global Infrastructure Partners. “They have approached bankers and asked them to gauge the interest of the promoters. The first talks are expected to take place in the coming weeks or months, but a final agreement is likely to be reached in four to six months,” said a source mentioned in the press report.
India’s telecom market is growing rapidly and has more than 809,000 towers, with an annual growth rate of 7 percent. Given the strong interest from the funds, a quick deal could be in the works. Reports suggest that KKR, Stonepeak and Macquarie were among the early contenders for ATC’s assets in India, the report said.
The strong market position of the telecommunications sector
In recent years, the telecom infrastructure sector has attracted significant attention from global infrastructure, sovereign and venture capital funds. Key market players such as Reliance Jio and Bharti Airtel are enhancing their 5G capabilities and expanding broadband services to rural and semi-urban areas. This expansion is expected to increase demand for new towers and small cells, positioning the sector for potential growth and investment opportunities.
Ascend Telecom serves major clients including Bharti Airtel, Vodafone Idea, Reliance Jio and BSNL. The company operates around 18,600 towers with 30,800 leases, providing high-power small cell sites, fiber-to-the-home services and edge data center infrastructure.
Ascend Portfolio
In the June quarter, Ascend posted a profit of Rs 192.90 crore, recovering from a loss of Rs 26.70 crore in the same period last year. Revenue grew 12.17 per cent to Rs 292.10 crore, up from Rs 260.40 crore a year earlier, the report said.
Last year, Ascend expanded its portfolio by acquiring Gurugram-based Tower Vision India Pvt. Ltd. Ltd for $365 million, which added around 9,000 towers to its assets, making Ascend the fourth-largest player at the time.
Brookfield’s recent acquisition of ATC’s Indian operations marks its third major investment in the telecom tower space. Brookfield entered the market in 2020 with the purchase of 175,000 towers from Reliance Industrial Investments and Holdings Ltd, creating Summit Digitel. It later acquired the 6,300 sites from Space Teleinfra Pvt Ltd in 2021-22 for Rs 900 crore, rebranding them as Crest Digitel, the report said.
Altius becomes tower leader
Last month, Brookfield, in partnership with BCI and GIC, acquired ATC India’s portfolio of 76,000 towers. Brookfield’s combined telecom infrastructure assets (Summit Digitel, Crest Digitel and ATC India) will operate under a new brand, Altius, creating India’s largest tower service provider with a total of 257,000 towers.
Prior to Brookfield’s acquisition of ATC, Indus Towers, primarily owned by Bharti Airtel, was the leader in India’s tower market with 226,000 towers, formed through the merger of Indus Towers and Bharti Infratel in 2019-20.
First published: October 3, 2024 | 10:57 am IS
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