IDFC Alternate options targets majority stake in GTL Infrastructure


IDFC Alternate options, the non-public fairness arm of IDFC Ltd, is eager to accumulate a controlling stake in GTL Infrastructure Ltd from the lenders of the debt-laden telecom tower operator, two individuals conscious of the event stated.

Lenders to GTL Infra are prone to public sale a controlling stake within the firm earlier than mid-2017, the individuals stated.

“IDFC Alternate options is in search of massive play within the telecom infrastructure area and GTL Infra tops its record of potential acquisitions,” stated the primary individual, who didn’t want to be recognized, because the talks are non-public.

“The PE fund is eager to solely put money into belongings the place it could possibly get a controlling stake and may drive development and consolidation,” stated the second individual cited above.

GTL Infra owns and operates 27,000 towers throughout 22 telecom circles within the nation.

A spokesperson for IDFC Alternate options declined to touch upon the story. “It’s untimely to touch upon the probably bidders earlier than the SDR (strategic debt restructuring) course of is full,” a GTL spokesperson stated on cellphone.

On 28 November, GTL Infra stated in a submitting to exchanges that it has constituted a committee of unbiased administrators to watch the implementation of its SDR scheme. The committee chaired by former Sidbi chairman and managing director N. Balasubramanian additionally contains former RBI deputy governor Ok.C. Chakrabarty, former Sebi chairman G.N. Bajpai and chief government and managing director of Haribhakti Group Shailesh Haribhakti as particular invitees.

In September, the joint lenders discussion board determined to invoke the SDR scheme to transform GTL Infra’s Rs3,300 crore excellent loans into fairness shares, which might translate into greater than 51% stake within the firm.

In keeping with RBI pointers, the conversion of debt to fairness beneath SDR ought to occur inside 210 days of the overview and reference date and the induction of a brand new investor ought to happen throughout the subsequent 18 months from the date.

For IDFC Alternate options, a profitable bid for GTL Infra will mark its second funding within the telecom tower enterprise. Final yr, the PE fund partially bought its stake in telecom tower operator Viom Networks Ltd. American Tower Corp. acquired a 51% stake final yr in Viom for Rs7,635 crore.

“GTL Infra has not been in a position to make a mark out there, which I really feel is essentially attributable to its incapability to commit sufficient sources to develop the enterprise,” stated Mahesh Uppal, founder, ComFirst consultancy.

For FY16, GTL Infra reported losses of Rs547.34 crore in opposition to complete income of Rs631.45 crore. It had a standalone debt of near Rs5,000 crore on its books.

India’s telecom tower firms have seen numerous massive offers within the latest previous, indicating consolidation within the sector. On 1 December, Mint reported that Canada’s Brookfield Asset Administration Inc. has emerged as the very best bidder for a 51% stake in telecom tower service supplier Bharti Infratel Ltd and has begun unique talks with the agency’s promoters Bharti Airtel.

Brookfield has additionally signed an settlement with Reliance Communications Ltd in October to accumulate a 51% stake in its cellular tower enterprise for Rs11,000 crore. On 29 November, CNBC TV-18 reported that Thought Mobile has placed on block its tower arm, dropping its earlier plans to promote a minority stake within the enterprise, for near $1 billion.

The potential acquisition of GTL Infra might mark a uncommon occasion of a profitable decision of a careworn belongings case by the SDR route. Until August, banks in India had invoked the provisions of SDR in not less than 21 instances. Of those, they’ve closed out solely two. Difficulties to find patrons, disagreement over valuations and even the selection of service provider bankers used within the SDR course of are stated to be among the many causes impeding closure.

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