Brookfield To Buy ATC's India Business In $2.5 Billion Deal

Canadian firm Brookfield is all set to acquire the Indian business of American Tower Corporation, in a mega $2.5 billion deal that includes $2 billion enterprise value on ATC India alongside a "ticking fee" accruing from Oct. 1, 2023.

The transaction is subject to regulatory approvals and expected to close in the second half of 2024.

"Data Infrastructure Trust (DIT), an Infrastructure Investment Trust sponsored by an affiliate of Brookfield Asset Management , today announced the signing of an agreement with ATC to acquire 100% of the equity interests in American Tower's operations in India (ATC India), for an enterprise value of Rs 16,500 crore ($2 billion) which is subject to pre-closing terms as per the securities purchase agreement," a release by DIT said.

ATC India has a portfolio of approximately 78,000 sites across India.

A release by ATC said total cash proceeds to American Tower at closing, subject to certain pre-closing terms, would potentially represent up to approximately Rs 21,000 crore or $2.5 billion at current exchange rates.

"Total cash proceeds include an enterprise value on ATC India operations of approximately $2 billion, plus a ticking fee that accrues from Oct. 1, 2023, to the date of closing," the release said spelling out financial details of the transaction.

Proceeds associated with the enterprise value assume the repayment of existing intercompany debt and the repayment, or assumption, of the existing India term loan, by DIT.

"Furthermore, and considered within the total potential cash proceeds above, American Tower will retain the full economic benefit associated with the optionally converted debentures (OCDs) issued by Vodafone Idea and will be entitled to receive future payments related to existing ATC India receivables. Proceeds from the transaction are expected to be used to repay American Tower's existing indebtedness," ATC said.

DIT houses Brookfield's telecom tower businesses in India through Summit Digitel and Crest Digitel.

This will be Brookfield's third acquisition in the Indian telecommunications space. According to Brookfield's release, in 2022 it had acquired a portfolio of 5,000 indoor business solution sites and small cell sites, which advances the rollout of 5G and enables telecom operators to extend their coverage capacity in difficult-to-access and dense areas.

Brookfield also has a portfolio of nearly 1,75,000 towers that were acquired in 2020 from Reliance Industrial Investments and Holdings Ltd.

ATC India will be included in DIT, which includes the existing telecommunications assets.

Arpit Agrawal, Managing Director, Head of Infrastructure, India and Middle East, at Brookfield, said, "We look forward to expanding and enhancing our existing telecom tower portfolio in India, which enables a broader array of solutions for our customers and partners."

Agrawal added: "Through strategic acquisitions like ATC India, we remain deeply committed to empowering digital connectivity and transforming the telecom infrastructure landscape across the region."

In India, Brookfield has approximately $25 billion in assets under management across Infrastructure, Real Estate, Renewable Power and Transition and Private Equity.