Global private equity majors look to invest in India's Vodafone Idea

Global private equity majors look to invest in India's Vodafone Idea

Indian telecom operator Vodafone Idea Limited, doing business as Vi, is engaging with private equity giants TPG Global, Apollo Global, and Carlyle Group to sell You Broadband along with fibre and data centre assets to raise US$1 billion.

According to the Hindustan Times newspaper, Vodafone Idea plans to sign the deal on a “sale-and-leaseback basis” which will allow the telecom operator to continue using its optic fibre infrastructure and data centers which are necessary to support daily operations.

“The fibre assets, fixed broadband, and data centre businesses have an immense growth potential since telecom and internet penetration is rapidly increasing. Pricing will be the key for the PE deals. Within 2-3 months, the deals should get closed,” an unnamed source told the publication.

Vodafone Idea had recently asked the Department of Telecommunications to approve a year of moratorium to clear dues related to the recently purchased spectrum. The telco informed the DoT secretary that its investors are unwilling to infuse money unless tariffs rise and the health of the industry improves.

According to the Economic Times, Vodafone Idea currently presides over around 160,000km of fibre. The report notes that the deal will likely include YOU Broadband, which Vodafone acquired from The Rohatyn Group (TRG) for INR4 billion (USD59.9 million) in June 2017. The ISP currently has a presence in 21 cities and serves more than 800,000 customers.

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