BOSTON - American Tower Corporation (NYSE: NYSE:AMT), a global real estate investment trust (REIT) and independent communications infrastructure provider, has entered into a definitive agreement to sell its Indian operations, ATC India, to Data Infrastructure Trust (DIT). DIT is linked to Brookfield Asset Management (NYSE: TSX:BAM, TSX: BAM), which operates telecom tower businesses in India.
The deal, resulting from a strategic review of American Tower's assets in India, is expected to net the company up to approximately INR 210B, equivalent to $2.5B based on current exchange rates. The transaction includes an enterprise value of about $2.0B for ATC India, plus additional fees accruing from October 1, 2023, until the closing date, which is anticipated in the second half of 2024.
Completion of the sale is subject to customary closing conditions, including approvals from government and regulatory bodies. American Tower plans to use the proceeds from the sale to reduce its existing debt. Additionally, the company will retain the economic benefits from optionally converted debentures issued by Vodafone (NASDAQ:VOD) Idea and is entitled to future payments related to existing receivables from ATC India.
Citi and CDX Advisors are acting as financial advisors, while Talwar Thakore & Associates is the principal legal advisor for American Tower in this transaction.
American Tower operates nearly 225,000 communication sites globally and has a significant presence in the U.S. data center market. The sale of its Indian operations marks a significant shift in its international portfolio. This news is based on a press release statement and all forward-looking statements regarding the sale's closure and the use of proceeds are subject to various factors, including those disclosed in American Tower's regulatory filings.
InvestingPro Insights
In the context of American Tower Corporation's strategic move to sell its Indian operations, it is noteworthy that the company's financial metrics and analyst insights paint a picture of robust financial health and growth prospects. According to InvestingPro data, American Tower boasts a market capitalization of $14.14B and a price-to-earnings (P/E) ratio of 17.89, reflecting investor confidence in its earnings potential.
InvestingPro Tips highlight the company's high earnings quality, with free cash flow exceeding net income, and a consistent increase in earnings per share. These factors are particularly relevant as the company plans to use the proceeds from the sale to reduce its existing debt, potentially strengthening its financial position. Moreover, the impressive gross profit margin of 92.39% for the last twelve months as of Q3 2023 underscores the company's operational efficiency.
Investors looking for more in-depth analysis and additional insights can explore the full range of 11 InvestingPro Tips available for American Tower. To make the most of these insights, consider subscribing to InvestingPro, now available at a special New Year sale with a discount of up to 50%. Plus, use the coupon code sfy24 to get an additional 15% off a 2-year InvestingPro+ subscription, providing a comprehensive toolset to navigate market trends effectively.
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