Lenders may push Aircel to buy GTL’s $2.5bn tower company

MUMBAI: Malaysia’s Maxis Communications-owned mobile telephony provider Aircel is making a move to acquire independent tower operator GTL Infrastructure in a deal, which is being pushed by the common lenders of the two troubled companies, people directly aware of the matter said. The sudden move is triggered by Maxis’ decision to stay put in the Indian telecom market — though with a smaller, profitable footprint — following a Rs 13,000-crore debt restructuring with the banks.

GTL Infra, which is now majority owned by the lenders under the strategic debt restructuring programme, is running a sale process as mandated by the RBI’s loan recast scheme. Aircel’s interest comes even as EY, which is advising the lenders and GTL, is expected to open the sealed bids from four-five bidders in the next one week. A consortium of lenders together control 61%, while promoter Manoj Tirodkar owns around 21% stake, leaving the rest with public shareholders. The tower operator, which is seen as a turnaround story, has close to 28,000 towers with over 55,000 tenancies.



Based on recent deal-making in telecom towers, media reports said GTL was expecting the bidders to value the company at around Rs 15,000 crore (about $2.5 billion). When contacted, a GTL spokesperson said, “We cannot speculate on bidders. We, however, welcome anyone, including Aircel, to join the sale process through a fair and transparent price discovery process. It should protect our past, present and future price receivables.”

Maxis and Aircel could not be reached for immediate comments on Thursday night.

Incidentally, if the Aircel acquisition move goes through, it will be a curious case of the telco buying back the tower assets it sold to GTL for $1.8 billion in 2010. Aircel accounts for 43% of the company’s tenancies, while Reliance Jio is expected to account for nearly 20% of tenancies by this fiscal end. BSNL and Vodafone are among others using the GTL Infra network.

Sources said Aircel was poised for a debt-recast deal with the lenders as it plans to focus on nine key circles, especially in the southern markets, where it has a reasonably strong presence and brand recall. Maxis founder and Indian origin billionaire Ananda Krishnan has pumped nearly $7 billion in equity into Aircel even as the company struggled with the crisis-ridden domestic telecom industry in the past six years. Aircel, which recently ended merger talks with Reliance Communications, wants to keep a sustainable Indian network for the next few years before reengaging in M&A talks for an eventual exit deal. Aircel has over 80 million subscribers.