American Tower Corporation (NYSE:AMT) announced that Sunday it entered into agreements with Vodafone India Limited and Idea Cellular Limited through which it will add an aggregate of approximately 20,000 communications sites to its existing Indian portfolio.
As part of the transactions, ATC TIPL, Vodafone and Idea have established a preferred partner structure under which Vodafone and Idea, given their expanded relationship with ATC TIPL, will receive service level and process efficiency benefits. In turn, ATC TIPL will secure certain preferential rights for future new business commencements on its existing portfolio and on the sites being acquired in certain Indian markets. The aggregate cash consideration for the transactions is expected to be INR 78.5 billion, or approximately $1.2 billion at current exchange rates, subject to customary closing adjustments.
Jim Taiclet, American Tower’s Chief Executive Officer stated, “We expect the addition of these two high quality portfolios to be highly complementary to our existing assets and to contribute to long-term leasing growth as India’s leading mobile operators accelerate their 4G network deployments.”
The transactions are expected to generate approximately $320 million in property revenue and approximately $120 million in gross margin during their first full year in American Tower’s portfolio, at current exchange rates. Further, SG&A associated with the assets is expected to be less than $10 million for the first year. The transactions are expected to be immediately accretive to AFFO per share, are subject to customary closing conditions and regulatory approval, and are expected to close in the first half of 2018.
November 14, 2017