KEC International Ltd has inked a pact to sell its 381 telecom sites in Chhattisgarh, Meghalaya and Mizoram to NASDAQ-listed American Tower Corp's (ATC) Indian arm for Rs 81 crore (approximately $13 million), according to a stock market disclosure.
The two companies have signed a binding agreement for the transaction, which is subject to necessary regulatory and third-party approvals and compliance with the conditions in the agreement.
KEC International, which is part of Harsh Goenka-led RPG Group, designs and erects transmission towers and power transmission lines on an engineering, procurement and construction (EPC) basis.
It has three tower manufacturing facilities at Nagpur, Jaipur and Jabalpur in India. Also, the company has a tower manufacturing facility each in Mexico and Brazil, totalling a combined manufacturing capacity of 311,200 metric tonnes per annum.
The firm had created a small set of telecom towers as part of forward integration of its telecom tower installation business seven-eight years ago. However, this fell under its non-core business assets and it has decided to sell it off.
On Tuesday, shares of KEC International ended the day at Rs 100.60 per share on BSE in a weak Mumbai market.
The deal has been struck at a valuation of roughly Rs 21.2 lakh per tower.
For ATC, this is the fourth acquisition in India taking its total tower assets in the country to over 13,000. Globally, the company has a portfolio of over 87,000 communications sites.
ATC entered India in 2007 and one year later bagged its first order to build 175 sites in Bihar and Orissa. In May 2009, it acquired Xcel Telecom to add 1,657 towers to its portfolio and in November the same year acquired 327 more towers in East India from Transcend Infrastructure.
In 2010, it consolidated its position by acquiring 4,629 towers from Essar Telecom. The firm crossed the milestone of 10,000 towers mark in 2012.
In a big deal last November, ATC agreed to acquire Indian cellular services provider Bharti Airtel Ltd's over 4,800 communications towers in Nigeria for about $1.05 billion. For ATC, the deal with Bharti was significant as it will enable it to launch its operations in Nigeria.
(Edited by Joby Puthuparampil Johnson)