New Delhi, May 24 (PTI) The telecom department today cleared sale of standalone mobile towers of Idea Cellular for Rs 4,000 crore to the Indian arm of American Tower Corporation -- paving the way for merger of Idea and Vodafone India.

"Idea-ATC deal has been cleared," an official source told PTI.

Queries sent to Idea and ATC did not elicit any reply.

ATC (American Tower Corporation) Telecom Infrastructure had signed pact with Vodafone India and Idea in November 2017 to buy their standalone towers for Rs 7,850 crore. The deal excluded holding of Vodafone and Idea in Indus Towers.

The standalone tower businesses of Vodafone and Idea have a combined portfolio of nearly 20,000 towers, which included around 10,200 towers of Vodafone and the rest of Idea.

With the closure of deal with Idea, ATC Telecom Infrastructure will have around 68,000 mobile towers in its portfolio.

The clearance of this deal will also bring merger of Idea-Vodafone, which will create the country's biggest mobile operator with over 430 million subscriber, closer to the regulatory approval.

According to sources, DoT wanted to clear Idea, Vodafone and ATC tower sale deal before approving merger of Idea-Vodafone as change in structure of the organisations would have created complexity in document work.

Idea has already accounted the proceed of Rs 4,000 crore that it will get from ATC for the debt that it will carry forward to the merged entity with Vodafone.

The Aditya Birla group firm has also option to sell its 11.15 per cent stake in Indus Towers for a cash consideration of around Rs 6,500 crore.

The lower level of debt and operational cost in the merged entity is expected to stabilise the position of both Idea and Vodafone in the Indian telecom market, which is reeling under heavy debt and facing intense tariff war.

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