Merger to create cell tower giant

India’s Bharti Infratel has agreed to merge with Indus Towers in a deal that creates the secondlargest telecommunications tower company in the world with an estimated equity value of $14.6bn.

Seeking to capitalise on rapid growth in smartphone usage, the transaction, which values Indus Towers at $10bn, will create an infrastructure giant with more than 163,000 towers, lagging only China Tower.

Top Indian telecoms carrier Bharti Airtel, the majority owner of Bharti Infratel, would be the biggest shareholder in the combined company, followed by Vodafone, the companies said.

Indus’s two other main shareholders, Idea Cellular and Providence Equity Partners, will have an option to cash out.

Bharti Airtel said separately it would sound out potential investors with a view to selling stakes in the combined entity.

The deal comes amid a vicious price war in the world’s second-biggest market by mobile phone users that has helped spur a rush of mergers and acquisitions activity, including a planned merger of Vodafone’s Indian unit and Idea that threatens Bharti Airtel’s position as India’s biggest phone carrier.

Vodafone and Idea had flagged they would look at selling their stakes in Indus and other tower assets they separately own to help cut debt for the merged telecoms carrier.

The deal comes a day after Bharti Airtel reported its smallest quarterly profit in 15 years.