Vodafone Idea hit with bill for cutting tower tenancies

Vodafone Idea hit with bill for cutting tower tenancies

Indian tower firms Bharti Infratel and Indus Towers claim that Vodafone Idea owes them INR45 billion ($632 million) for vacating slots on their towers before its lease had expired.

Vodafone Idea has countered that as a merged unit, it required fewer tenancies than Vodafone India and Idea Cellular did prior to their tie-up last August.

The Economic Times noted that the operator had not exited the tenancies, but rather converted two into a single tenancy on the same sites with higher loading. The operator claims that this means that no payment is required.

The spate of consolidation among Indian mobile operators has had a knock-on effect on the country’s tower industry, with co-locations down significantly across the past year as the number of providers fell from ten down to five. Revenue has accordingly slumped.

Analyst firm Crisil estimates that rentals per tower will have fallen by 7-9% over the past fiscal year (ending 30th March 2019). Bharti Infratel’s co-locations fell by 17.2% in the last quarter, while Indus Tower’s dropped 23.3%.

Before the end of the fiscal year, Bharti Infratel is due to merge with Indus Towers, which is itself a joint venture between Infratel and Vodafone Idea’s parent firms, Aditya Birla and Vodafone. However, Vodafone Idea is reportedly planning to divest its 11% stake in Indus Towers in order to cut its INR1.26 trillion debt.

Sign-up to our weekly newsletter

Keep up-to-date with all the latest news, articles, event and product updates posted on Developing Telecoms.
Subscribe to our FREE weekly email newsletters for the latest telecom info in developing and emerging markets globally.
Sending occasional e-mail from 3rd parties about industry white papers, online and live events relevant to subscribers helps us fund this website and free weekly newsletter. We never sell your personal data. Click here to view our privacy policy.