Vodafone (LON:VOD) has inked a deal to sell its standalone tower business in India, the blue-chip telco has said. The move comes as the FTSE 100 group prepares to update investors on its half-year performance tomorrow.
Vodafone’s share price has slipped into the red in today’s session, having given up 0.46 percent to 216.65p as of 13:55 GMT, marginally underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.29 percent lower at 7,411.57 points. The group’s shares have added just under six percent to their value over the past year, and are up by some eight percent in the year-to-date.
Tower business sale
Vodafone and Idea Cellular announced today that they had agreed to sell their respective standalone tower businesses in India to ATC Telecom Infrastructure for an aggregate enterprise value of INR78.5 billion ($1.2 billion). The move comes as Vodafone prepares to merge its business in India with Idea Cellular. The companies noted that in the event that the completion of today’s sale precedes the completion of the proposed merger, both expected next year, Vodafone India will receive INR38.5 billion ($592 million).
The deal follows challenges for the blue-chip telco in India, with the entry of rival Reliance Jio sparking a price war in the country’s telecoms market.
Vodafone is scheduled to update investors on its half-year results and Proactive Investors reports that attention is likely to centre on the telco’s dividend.
“With little in the way of share price growth over the last two years, investors have focused more on the attractive 6% yield,” said Graham Spooner, analyst at The Share Centre, as quoted by the newswire, adding that areas to concentrate on will be the group’s “performance in key European operations, which have been mixed, along with India and other emerging markets”.
The results will come after Vodafone unveiled plans last week to bring ultrafast broadband to up to five million UK homes by 2025, with the move seen as a threat to former telecoms monopoly BT Group (LON:BT.A).