Brookfield got ATC India. Now, its rivals are eyeing Ascend Telecom

The funds are keen to start negotiations with the tower firm fully owned by US-based Global Infrastructure Partners, the people cited above said on the condition of anonymity.

“They’ve approached bankers and have asked them guage the interest of the promoters. Early-stage discussions are expected to take place in the coming weeks or months, but a final deal is likely in four to six months," said one of the people directly involved in the discussions, asking not to be named.

A deal may proceed quickly given the funds' keen interest in the Indian tower market, the second person added. The three funds were reportedly among the list of initial suitors for ATC’s India assets.

Queries sent to KKR & Co, and Ascend Telecom remained unanswered. Macquarie Capital and Stonepeak declined to comment. Global Infrastructure Partners said it was not looking to exit Ascend.

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The telecom infrastructure space has seen interest from global infrastructure, sovereign and venture funds over the past couple of years. India has more than 809,000 telecom towers, and industry estimates say the number is growing 7% annually.

Telecom service providers Reliance Jio and Bharti Airtel are strengthening their 5G capacities and deepening broadband penetration beyond urban markets. Freshly funded Vodafone Idea and state-run Bharat Sanchar Nigam Ltd will be rolling out their 4G and 5G services as well. Further expansion in rural and semi-urban areas will also fuel demand for new towers as well as small cells to improve coverage and capacities. This segment of the market is expected to see an upside in the coming years, attracting investor interest.

Ascend, which counts Bharti Airtel, Vodafone Idea, Reliance Jio and BSNL among its customers, has about 18,600 towers with 30,800 tenancies. It also provides high-power small cell sites, fibre-to-the-home and to the node, intermediate stations for national long-distance optical fibre routes and edge data centre infrastructure.

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It reported a profit of ₹192.90 crore in the June quarter against a loss of ₹26.70 crore a year earlier. Revenue was up 12.17% to ₹292.10 crore from ₹260.40 crore in the same period.

Last year, Ascend acquired Gurugram-based Tower Vision India Pvt. Ltd which had about 9,000 towers for $365 million, becoming the fourth largest at that time.

ATC's India exit marked Brookfield’s third tower acquisition in India. It had entered the sector in 2020 by acquiring 175,000 towers from Reliance Industrial Investments and Holdings Ltd, and named it Summit Digitel. It has since acquired Space Teleinfra Pvt. Ltd’s 6,300 sites, providing in-building solutions and outdoor small cell solutions for ₹900 crore in 2021-22. The firm is called Crest Digitel.

Brookfield, along with partners BCI and GIC, bought out the then No. 3 player ATC India’s 76,000-tower portfolio last month. All of its telecom infrastructure assets including Summit Digitel, Crest Digitel and ATC India will be housed under a new brand called Altius, with a total portfolio of 257,000 towers, making it India's largest tower services provider.

Until the Brookfield-ATC deal, Indus Towers which is majority owned by Bharti Airtel was India's tower market leader with 226,000 towers. It was created through the merger of the erstwhile Indus Towers and Bharti Infratel in 2019-20.

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