India’s Union Cabinet has approved the spinning off of state-owned telco Bharat Sanchar Nigam Ltd’s (BSNL’s) tower assets into a separate company, the Economic Times reports. According to unnamed sources familiar with the matter, the government gave an ‘in-principle’ approval to hive off the tower assets, with the Department of Telecommunications (DoT) now set to establish an inter-ministerial group for working out the capital and organisational structure of the new company, once a market valuation of BSNL’s tower assets is carried out. India is thought to be home to around 400,000 telecom towers, with estimates that BSNL is the second-largest player in the sector, with roughly 65,000 towers (valued at INR200 billion [USD14.8 million]).
Meanwhile, the government has offered INR6.272 billion as compensation to BSNL and its sister company Mahanagar Telephone Nigam Ltd (MTNL) for surrendering CDMA spectrum in the 800MHz band, which was auctioned in March 2015. BSNL will be compensated INR1.692 billion for giving up frequencies in the aforementioned band in four circles, while MTNL will get INR4.580 billion from returning 1.25MHz each in Mumbai and Delhi. The government has gained revenue of INR3.998 billion from the sale of the auctioned 800MHz spectrum for 20 years.