Quippo to invest $3 billion, expand telecom infrastructure business

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According to QTIL managing director Arun Kapur, the company, which plans to grow organically as well as inorganically, is in talks with Tata Teleservices to buy its telecom tower business.

"The company is planning to invest $3 billion to grow both organically and inorganically. We are in an advanced stage of negotiation with Tata Teleservices and the deal is expected to be concluded by next month," Kapur said.

"Consolidation is the order of the day. This is a capital -intensive industry. In this scenario consolidation is going to be the name of the game," he said.

Last December, Vodafone, Bharti Airtel and Idea Cellular jointly formed Indus Towers, an independent company, to share 70,000 towers across the country.

QTIL, which plans to more than double the number of its towers to 10,000 from the present 4,500 by March 2009 and increase the figure to 25,000 towers by 2010, is also reportedly in talks with the Essar Group for a possible merger of its telecom tower business with Essar Telecom Infrastructure Pvt Ltd. Essar is also reportedly in talks with GTL Ltd and privately-held Asper for the same purpose.

Both the Tatas and Essars plan to divest their stakes in their tower arms. While the Tatas have 10,000 towers, the Essars have 3,000 towers in 13 circles.

QTIL also plans to venture into active infrastructure sharing. "We are in talks with all the new players who are receiving spectrum such as Datacom, Bycell, Shyam for active infrastructure sharing," Kapur said added.

Infrastructure sharing allows telecom service providers to cut costs in network roll-out and pass on the savings to consumers.

QTIL is a division of Quippo Infrastructure Equipment Ltd (QIEL), an associate concern of SREI Infrastructure Finance Ltd, one of the leading non-banking financial institutions in India. Under the brand name Quippo, SREI operates the country's largest infrastructure equipment rental company, servicing the high growth verticals of construction, mining, oil & gas, telecom and energy.