Deal Closed | Initial Offer by Tower Infrastructure Trust

Brookfield gets govt's approval for the purchase of Reliance telecom tower assets.

The details of the deal  are as under:

Sector: TMT

Announcement Date: 01-Sep-2020

Completion Date: 01-Sep-2020

Name of Issuer: Tower Infrastructure Trust (an InvIT sponsored by Reliance and Brookfield)

Deal Description: Initial offer by Tower Infrastructure Trust (the "Trust") of 2,521,500,000 Units by way of a private placement of its units at a price of INR 100 per Unit, aggregating to INR 252,150 million. 

Total Consideration: INR 252,150 million (USD 3.4 billion)

Team Members: Sudhir Bassi (Executive Director), Abhimanyu Bhattacharya (Partner), Navodita Gupta (Principal Associate), Vijayaraghavan (Senior Associate) and Adrika Dhawan (Associate)

Role of Firm: Legal Counsel to the Lead Manager as to Indian Law

Lead Manager to the Issue: ICICI Securities Limited 

Financial Advisors to the Brookfield Sponsor: Ambit Private Limited

Other legal advisors: Legal Counsel to the Trust, the Reliance Sponsor and the Investment Manager as to Indian Law- Cyril Amarchand Mangaldas

Legal Counsel to the Brookfield Sponsor as to Indian Law: AZB & Partners

International Legal Counsel to the Lead Manager: Latham & Watkins LLP

Unique Feature of Transaction

1. This is the largest fund raise by an InvIT in India.
2. First InvIT in the telecom sector.
3. First InvIT which acquired an asset prior to launching the initial offer of its units.
4. The InvIT holds a controlling interest in one of the largest independent tower infrastructure companies in India, whose tower assets are leased to Reliance Jio, the industry leader in the Indian telecommunications sector with the largest market share of 39.5% and 56.9% based on revenue and total broadband subscribers.
5. First InvIT with an independent investment manager (i.e. not related to the sponsors of the InvIT). 

This is the second successive InvIT of the Reliance group that Khaitan & Co has advised on (first one being the transaction by the India Infrastructure Trust). Khaitan & Co was the only common counsel in the two deals 

Innovative Feature of the transactions: InvIT will hold the tower assets for a term of 30 years; and at the end of such period, the asset shall be transferred to an entity forming part of the Reliance group pursuant to exercise of a put option. The acquisition of assets by the InvIT is structured like a concession wherein Reliance Jio has entered into an agreement, pursuant to which Reliance Jio shall be granted one tenancy on all the tower assets for a term of 30 years providing continuity and stability in revenues for the tower assets.