US fund TA leads Rs 3,000 crore acquisition of broadband company Atria

BANGALORE: Private equity major TA Associates is leading a $500-million, or Rs 3,000 crore, acquisition of Atria Convergence Technologies (ACT), one of the country's leading high-speed broadband service providers headquartered in Bangalore.

TA will spend about $200 million (Rs 1,300 crore) while its co-investors, through a Mauritius entity called Argan, will bring in the rest of the money to buy a little over 90 per cent stake in ACT.

Last week, TOI first reported that TA was leading a deal in the Bangalore-based company. This is also one of the largest private equity transactions in India this year.

Broadband and cable TV access provider Atria has one million subscribers across the southern states of Karnataka, Tamil Nadu, Andhra and Telangana. The company offers triple-play services — broadband, television and fixed-line voice — using optical fibre technology.

ACT is adding over 20,000 new subscribers every month, and has a 25 per cent share of the market in Bangalore. High-speed broadband is a lucrative business for most cable players with significantly higher average revenue per user (ARPU) levels.

This will be TA's single largest investment deal in the country. Globally, the US private equity firm manages assets worth $18 billion and has investments in Indian companies like Micromax, BillDesk and Dr Lal PathLabs, among others.

"We believe that in the coming years, India will see a significant increase in wired broadband penetration," said Dhiraj Poddar, co-head of India at TA Associates Advisory, who will join ACT's board of directors at the close of the investment. "With a proven record of execution, an attractive business model, and an experienced and highly capable management team, we expect continued growth for ACT," he added.