Indus Towers block deal: 19% equity changed hands; stock declines over 5%

Shares of Indus Towers will gain traction in Wednesday’s trade (June 19) as there is expected to be a block deal in the telecom infra major. According to Zee Business citing a Bloomberg report, Vodafone Group is looking to pare 18 per cent stake in Indus Towers to raise around $198 crore.

The floor price of the deal is pegged in the range of Rs 310-341 per share. At the lower price of the price band, the deal would likely take place at a discount of around 10 per cent from the last close of Rs 343.9 apiece on the BSE.

Earlier Zee Business research said that Vodafone may offload its entire stake in Indus Towers this week. 

Bank of America, Morgan Stanley and BNP Paribas are expected to be brokers in the deal.

Stake sale history in Indus Towers

Vodafone Plc held a 28 per cent stake in Indus Towers. The company is mulling to exit the telecom infra company since 2022. Consequently, in March 2022, Vodafone Plc sold 4.7 per cent stake in Indus Towers to Bharti Airtel. 

How brokerages view the stake sale in Indus Towers by Vodafone?

Global brokerage UBS deems the transaction to be positive for Vodafone. The brokerage said that the stake sale is expected, nonetheless the deal size can be lower than estimated. Further, after paying off its debt, Vodafone may invest the amount raised from the deal in the company. Notably, Vodafone's borrowing secured against Indus Towers stood at Rs 15,350 crore.

Besides,  Bharti Airtel may not buy the complete stake in Indus Towers from Vodafone but may buy an additional stake to increase its stake in the entity from the current 47.95 per cent to 50 per cent.