TMT
By 30 October, 2009

Telecom tower infrastructure continues to be deal-hungry.

American Tower Corporation (ATC) has acquired Kolkata-based telecom tower firm Transcend Infrastructure for a sum of Rs 95 crore. Transcend, which operates around 325 wireless communications sites in the eastern states of the country, will increase ATC’s combined India portfolio to 2,500 sites.

This is the second acquisition of Nasdaq-listed ATC this year. In May, it completed the acquisition of XCEL Telecom Pvt Ltd for around Rs 800 crore. Transcend has been acquired from Singapore-based Insight Infrastructure, who set it up with two Kolkata- based companies, Skipper Steels and Century Plyboards in 2007.

Insight Infra is headed by Udhay Mathialagan, who has worked with passive telecom infra firm Crown Castle Australia and PE firm Jump Capital. Insight has been backed by Babcock & Brown and Bahrain Sovereign Fund Mumtalakat Holdings.

Transcend owns sites in Bihar, Orissa, West Bengal, Assam and North East and has an average tenancy of 1.3 on its sites. "We will use the Transcend platform to jump start our growth in the eastern circles where a majority of cellular operators are rolling out their networks," said Amit Sharma, President of ATC Asia.

The transaction also marks the continuation of consolidation in the telecom infrastructure space and falling valuations of towers. The last transaction, ATC's acquisitions of Xcel, saw each tower valued at Rs 44-47 lakh. The deal before that was Tata Teleservices merger with Quippo Telecom Infrastructure in December 2008, which valued each tower Rs 78 lakh. The present deal of ATC with Transcend values each tower at a little over Rs 29 lakh.

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