Tower Vision, a unit of Fore Group Management & Investments Ltd., owned by Moshe Shoshan, Eli Shoshan, and Gad and Dov Sluk, announced yesterday that it had raised $190 million at a company valuation of $405 million, before the money. The investment was led by Morgan Stanley, together with Migdal Capital Markets, which brought in Israeli investors. The largest investor in the round is Quadrangle Capital Partners, a US investment fund that manages assets worth $6 billion, and invested $125 million of the total invested in Tower Vision in the current round.
Fore Group owned 65% of Tower Vision before the round. Jarvinia, in which Mivtach Shamir is a 33% partner, held 20%, with the remaining 15% in the hands of RP Capital. After the round, Fore Group's holding is down to 34%, Jarvinia has about 11%, and RP Capital 8%. Quadrangle Capital Partners owns about 31%.
Tower Vision is also currently raising $140 million debt from banks in India.
The company, which was founded just four years ago, develops, operates, maintains, and manages cellular communications sites in India. It buys or erects sites and leases them on long term leases to wireless operators. Ownership of the sites enables it to lease them to several operators (multi-tenancy), which thus save time and costs in rolling out networks.
Tower Vision operates only in India, and for now it has no reason to expand beyond it. The number of wireless telephony subscribers in India grows at a rate some 10 million monthly, and of the 14 wireless carriers in the country, five have entered the market only recently and have chosen not to construct their own sites but to use existing sites, a trend that supports Tower Vision's growth.
"What convinced the investors who have now invested in the company was the way it has met its targets," Moshe Shoshan told "Globes", scarcely concealing his excitement.
Tower Vision raised $100 million in a bond issue two years ago, and Shoshan says the current round is to repay those bonds and to help the company reach at least 8,000 sites by the end of 2011. "After the current round, Tower Vision will have shareholders' equity of a little over $200 million, and an equity to debt ratio of less than 1:2," Shoshan points out.
I presume that one of the next stages will be a flotation on one of the world's main exchanges.
"Not necessarily. Above all, we want to end 2011 with 10,000 sites. Then we will have two possibilities: a flotation on the capital market in India or elsewhere, or the sale of the company to one of the leaders in the field."
Published by Globes [online], Israel business news - www.globes-online.com - on February 4, 2010
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