Quippo's Bangla Bid To Rescue Viom

India telecom tower company Quippo Telecom Infrastructure Ltd., which is backed by the infrastructure financing giant SREI Group, has made an INR 30 billion (US $539 million) bid to acquire the 5,200 towers of Banglalink, a leading operator in Bangladesh, reports The Economic Times.

The move could provide a major boost to Viom Networks, a joint-venture between Quippo and Tata Teleservices Ltd.

According to the report, the deal will be formulated in such a way that Viom Networks would be awarded the Banglalink towers management contract once the acquisition is completed.

This will provide an opportunity to Viom, formed in 2009 and which currently owns 38,500 towers in India, to boost its revenues. That's importance for Viom, as the value of India's tower market has slumped during the past 18 months. This is largely due to an uncertain regulatory environment and the withdrawal of many new entrants that were planning to expand their businesses.

There are other cost pressures on tower companies too, such as the high price of diesel fuel used to fuel towers, regular labor strikes and unpaid dues from operators. Companies such Bharti Infratel, Indus Towers Ltd. and Viom have already delayed their IPO plans because of a lack of appetite for mobile tower stocks from the investor community.

To reduce their costs, India's tower companies are already collaborating and looking for international deals. (See The Growing Importance Of Sharing.)

With more than 100,000 towers, Indus Towers is the leading tower company in India at present.

Jatinder Singh, Principal Correspondent, Light Reading India