The ongoing spat between Indian JV partners Vodafone and Essar has led to the mobile operator postponing plans to sell-off some 7,000 towers across seven circles, according to sources at India’s Economic Times newspaper. “The bidders have been told that this transaction has been put on hold till both partners [Vodafone and Essar] reach a solution to the ongoing corporate dispute. This deal is unlikely to see any traction soon and may be delayed by several months,” the source said. The newspaper reported last November that GTL Infrastructure and Tata Quippo (Viom) were in the race to buy Vodafone Essar’s towers across the seven circles in a deal valued at around INR3,500-4 ,000 crore (US$800 million). Vodafone Essar – India’s second-largest GSM operator – had reportedly been looking at the proceeds from the tower sale to partly fund its ongoing 3G rollout across the country.
Vodafone now holds only a small portfolio of towers after transferring most of its physical infrastructure to Indus Towers, a three-way joint venture between Vodafone and rival operators Bharti Airtel and Idea Cellular that manages towers in 16 telecom circles. Indus Towers announced separately this week that it plans to add nearly 5,000 telecom towers every year for the next five years and expects to turn over US$2 billion in revenue in the current fiscal year. Meanwhile, unconfirmed reports have emerged that Essar is planning to drop plans to transfer part of its 33 percent stake in Vodafone Essar to a separately listed firm – the cause of its dispute with its UK-based partner. Vodafone has argued that the strategy is an attempt to artificially inflate the stake’s value as a precursor to selling it.