Srei Infra rallies; American Tower Corp set to acquire group's stake in Viom Networks

NEW DELHI: Shares of Srei Infra gained about 8 per cent in trade on Monday on reports that Srei group, which has management control of Viom Networks with a minority stake, will exit the company.

The stock hit a day's high of Rs 46.05, up 7.71 per cent, on the BSE. It has gained over 22 per cent in the month of August, data showed.

American Tower Corp (ATC) is set to clinch the much-delayed deal to acquire a majority stake in telecom tower rival Viom that will see the Tata group retain a minority stake.

“The ATC board is expected to approve the deal this week, unless there are last-minute surprises,” one of the persons said. The deal values Viom at about Rs 19,000 crore, including a debt of around Rs 6,500 crore, one of them said.

The Tata group, currently the majority owner, will retain up to 26% stake as assurance to American Tower that the acquired company will be given tower leasing contracts from telco Tata Teleservices on a preferential basis. American Tower will hold the rest while Srei and other private equity firms are set to exit, the people said.

Sunil Kanoria, vice chairman of the Srei group, said: “Work (on the deal) has been going on.”

Tata Teleservices has a 54% stake in Viom and Srei owns 18.5% while the rest is held by private equity firms Macquarie SBI Infrastructure, GIC Investments, IDFC Private Equity and Funderburk Mauritius (Oman Investment Fund). The PE firms, which were brought in by Srei, need to sell their stake since their seven-year gestation period is over.

ATC declined to comment and there was no response to queries sent to the other stakeholders. Credit Suisse and Citigroup are said to be the advisers to Viom on the deal.

(With inputs from Bureau)