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Tower Infrastructure Trust (Tower InvIT) which is sponsored by Brookfield and backed by leading global infrastructure investors has struck a deal to acquire telecom infrastructure provider Space Teleinfra (STIPL) for an equity consideration of Rs 900 crore, according to an official announcement. Tower InvIT has a significant market share of India’s outdoor macro tower market, the announcement said.
To be sure, an InvIT is a collective investment scheme similar to a mutual fund, which enables direct investment of money from individual and institutional investors in infrastructure projects to earn a small portion of the income as return.
Space Teleinfra, a leader in its key markets, is a shared telecom infrastructure provider for voice and data connectivity. It commenced operations in 2016 with a focus on providing telecom infrastructure to mobile network operators ( MNO’s) for Outdoor Small Cells, In-building solutions and Roof Top Towers. The company has a customer base across all the three major MNOs with a pan-India presence.
Ankit Goel and Radhey R Sharma, the founders of Space Teleinfra, are first-generation entrepreneurs and they along with other shareholders will receive the consideration by way of a combination of cash and units in Tower InvIT through a preferential allotment of units. The deal consideration also includes an additional, substantial milestone-based consideration.
“Considering the synergies with Tower InvIT, this transaction will outline significant growth opportunities for STIPL. With the onset of 5G and data consumption trends, seamless indoor connectivity becomes as essential as outdoor connectivity, and this transaction will open new horizons for STIPL to lead this opportunity further. Through our ownership of units of Tower InvIT, we look forward to participating in the next chapter of growth in the shared Telecom Infrastructure business.” said Ankit Goel, Co-founder and Managing Director at STIPL.
“This transaction marks a coming of new age of the indoor connectivity business in India. After this transaction, the joint platform would now be able to offer preeminent and holistic solutions to MNOs with best-in-class service offerings across segments. With strong management teams of STIPL and Tower InvIT, and marquee investors, STIPL is well poised to continue its leadership position.” said Radhey R. Sharma, Co-founder and Director at STIPL.
The transaction is subject to certain regulatory and other customary conditions precedent common in transactions of this nature. Ambit acted as the exclusive financial advisor to the shareholders who were also advised by Khaitan and Co and Bobby Parikh Associates.
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