Vodafone Group Plc MERGER UPDATE - BHARTI INFRATEL AND INDUS TOWERS
01 Settembre 2020 - 09:27AM
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Vodafone Group Plc
01 September 2020
Vodafone Group Plc
News Release
1 September 2020
UPDATE ON THE MERGER OF BHARTI INFRATEL AND INDUS TOWERS
Vodafone Group Plc ("Vodafone") today announces that it has
agreed with Bharti Airtel Limited ("Bharti Airtel") and Vodafone
Idea Ltd ("Vodafone Idea") to proceed with completion of the merger
of Indus Towers Limited ("Indus Towers") and Bharti Infratel
Limited ("Bharti Infratel" and, following completion, the "Combined
Company").
It is expected that Vodafone will be issued with 760 million new
shares in the Combined Company at closing in exchange for its 42%
shareholding in Indus Towers on the basis that (a) Providence
Equity Partners ("Providence") has elected to receive shares in the
Combined Company in respect of its 4.85% shareholding in Indus
Towers, and (b) Vodafone Idea has elected to sell its full 11.15%
shareholding in Indus Towers for cash. The shares issued to
Vodafone would be equivalent to 28.2% in the Combined Company.
Bharti Airtel's shareholding in Bharti Infratel would be diluted
from 53.5% to 36.7%. Bharti Airtel and Vodafone will jointly
control the Combined Company.
At the current Bharti Infratel market valuation, Vodafone's
stake in the Combined Company would have a value of approximately
INR 151 billion (EUR1.7 billion) and Vodafone Idea would receive
approximately INR 40 billion (EUR464 million) in cash upon
completion.
The final number of shares issued to Vodafone and Providence, as
well as the cash paid to Vodafone Idea, will be based on agreed
closing adjustments, including but not limited to movements in net
debt and working capital for Bharti Infratel and Indus Towers up to
closing.
Security Package
The parties have agreed a security package (the "Security
Package") for the benefit of the Combined Company. The Security
Package can be invoked in the event Vodafone Idea is unable to
satisfy certain payment obligations under its Master Services
Agreement with the Combined Company (the "MSA").
The Security Package is supported entirely by consideration from
the transaction. The Security Package includes the following:
-- a prepayment in cash of INR 24 billion (EUR276 million) to be
made at completion of the transaction by Vodafone Idea (the
"Prepayment") to the Combined Company in respect of present and
future obligations under the MSA;
-- a primary pledge over shares owned by Vodafone in the
Combined Company with a value of INR 40 billion (EUR464 million);
and
-- a secondary pledge over shares owned by Vodafone in the
Combined Company (ranking behind Vodafone's existing lenders for
the EUR1.3 billion loan utilised to fund Vodafone's contribution to
the Vodafone Idea rights issue in 2019) with a maximum liability
cap of INR 42.5 billion (EUR489 million).
The implementation of the Security Package is subject to consent
from Vodafone's existing lenders in respect of the loan outlined
above, regulatory approvals and on an extraordinary dividend of INR
48 billion (EUR552 million) being declared by the Combined Company
within three months after completion.
The number of shares under the primary pledge will be determined
at completion, based on the prevailing Bharti Infratel share price.
The Security Package will reduce in value over time with payments
made by Vodafone Idea under the MSA.
Completion
The transaction is conditional on consent from Vodafone's
existing lenders and a grant of an extension by the National
Company Law Tribunal ("NCLT") in respect of the statutory filing
period for the merger scheme to make the merger scheme effective.
Lender consent is expected within 21 days, after which the parties
will work to complete the transaction expeditiously.
- ends -
For further information:
Vodafone Group
Media Relations Investor Relations
GroupMedia@vodafone.com IR@vodafone.co.uk
About Vodafone
Vodafone is a leading technology communications company keeping
society connected and building a digital future for everyone.
Vodafone is focused on two scaled and differentiated regional
platforms in Europe and Africa. We operate mobile and fixed
networks in 22 countries and partner with mobile networks in 48
more. As at 31 March 2020 we had over 300m mobile customers, more
than 27m fixed broadband customers and over 22m TV customers.
We connect for a better future. We are optimistic about how
technology and connectivity can enhance the future and improve
people's lives. Through our business, we aim to build a digital
society that enhances socio-economic progress, embraces everyone
and does not come at the cost of our planet. That is why we have
committed to improve one billion lives and halve our environmental
impact by 2025.
For more information, please visit: www.vodafone.com .
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September 01, 2020 03:12 ET (07:12 GMT)
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