"On completion of Idea and Vodafone India merger, 6,300 co-located tenancies on the combined standalone tower businesses will be merged into single tenancy, within a staggered period of two years, without a penalty fee", the Idea statement added. While the total mobile data users on Idea network remained flat at 38.2 million, the broadband (3G+4G) subscribers increased by 3.2 million to 29.6 million in second quarter. It merged its loss-making Indian mobile business with Idea, India's third-largest wireless operator, at the start of the year.
Idea and Vodafone have also chose to sell their standalone tower business in India to ATC Telecom Infra for Rs 7,850 crore.
Shares of the company declined Rs 2.65, or 2.73%, to trade at Rs 94.40 at the BSE (Monday).
The Board has approved the execution of a share purchase agreement amongst ATC Telecom Infrastructure, the Company and ICISL. The deal is expected to close in 2018.
Idea on Monday reported a consolidated net loss of Rs 1,106.8 crore for the second quarter of the current fiscal.
The established telecom operators have seen locked in a fierce tariff war to protect their turf, following the entry of aggressive newcomer Reliance Jio in the market.
"In the long term, we have a positive view on Idea and the deal could be viewed as a positive move with the 40 billion rupee-transaction value aiding Idea in cutting down its balance sheet debt", said Gaurang Shah, Head Investment Strategist at Geojit Financial Services.
In addition to the standalone tower business, Idea also owns 16% stake in Indus Tower Ltd, which is a three-way joint venture between Idea Cellular (through its unit Aditya Birla Telecom Ltd), Bharti Infratel Ltd and Vodafone India.
The company had a net debt of Rs 54100 crore at the end of September quarter.