Tower Talk: a guide to the week’s major cell site developments

15 Mar 2016

Digital Bridge Holdings is among the leading bidders for the portfolio of wireless towers owned by Etihad Etisalat (Mobily) in Saudi Arabia, Bloomberg reports, citing people with knowledge of the matter. The sale could fetch as much as USD2 billion, the news agency noted. Digital Bridge’s bid is backed by state-owned Saudi Arabian Oil Co, known as Aramco, and emerging markets-focused buyout firm Abraaj Group, the sources said. Digital Bridge, which invests in communications infrastructure, such as phone and broadcast towers, is also among bidders for the tower network owned by Zain Kuwait, the insiders noted. A spokesman for Mobily said that the company is assessing different options and that no decision has been made.

Deutsche Telekom (DT) is considering options for its infrastructure assets, including its mobile phone towers, Bloomberg reports. According to people familiar with the matter, the German phone company and advisers are weighing a possible spinoff or initial public offering (IPO), which could value the assets in the billions of dollars. Talks are still at an early stage and no final decisions have been made about which assets might be included, the people said. Last month, DT CFO Thomas Dannenfeldt confirmed that the company would be evaluating its options for its roughly 40,000 cell sites in Europe, admitting: ‘On the tower sales, I think it is something we are investigating. It is obvious and very clear that we have a strong position here.’

Mexican tower company Telesites generated revenues of MXN4.23 billion (USD236.8 million) for 2015, of which 63.3% percent corresponded to tower rental, El Financiero reports. EBITDA amounted to MXN2.45 billion, with a margin of 57.8%. The company reported a portfolio of 12,874 towers, of which 1,108 were built last year. Telesites was created last year from assets spun off by Mexican operator Americal Movil (AM).

Tele2 Russia is looking at selling around 10,000 mobile towers, people familiar with the matter have informed business daily Vedomosti. As such, the company has already held preliminary meetings with potential buyers, including the Russian Direct Investment Fund (RDIF), a USD10 billion fund established by the Russian government in June 2011 to make equity investments in high-growth sectors of the Russian economy. According to the paper, VimpelCom has hired Merrill Lynch to run the sale of 10,000 to 20,000 towers, while MegaFon is reportedly also looking to sell a 49% stake in its recently created towers subsidiary.

Alaskan telecoms operator General Communication Inc (GCI) intends to sell its tower division this year, it has confirmed. During the announcement of its fourth quarter earnings, the telco noted: ‘During 2016 we expect to monetise our urban wireless towers and rooftop locations for approximately USD90 million, in a sale leaseback transaction. We will redeploy and invest the cash received into our broadband infrastructure in Alaska’.

Cellnex Telecom of Spain and Italy’s F2i have submitted a joint offer to acquire a 45% stake in Telecom Italia’s tower unit Infrastrutture Wireless Italiane (INWIT), Reuters reports, citing two unnamed sources. Although no details of the proposal have been made public, the two mobile tower infrastructure firms were expected to increase their offer to around EUR5 (USD5.67) per share, improving on their previous bid of EUR4.5 per share. A deal at the higher price would value INWIT at approximately EUR3 billion. Under Italian law, acquiring a stake above 30% would trigger a mandatory buyout of minority shareholdings. In related news, Italian rival EI Towers has been linked with the acquisition of around 1,000 INWIT towers, for around EUR200 million. EI Towers has also offered to purchase a 25% stake in INWIT and is expected to submit an offer later today.

Elsewhere in Italy, Cellnex Italia has renewed its contract with SIRTI, a long-standing Italian company specialising in the design, implementation and maintenance of network infrastructure. The agreement, lasting for one year and involving an automatic renewal clause, provides for the maintenance of the entire portfolio of Cellnex’s telecommunications towers in Italy, comprising more than 7,400 sites. This collaboration fosters and extends the long-standing relationship with Cellnex. More than 1,500 engineers will be working on the SIRTI network of telecommunications towers throughout Italy.

Finally, IHS Holding has agreed to acquire Helios Towers Nigeria’s (HTN’s) portfolio of 1,211 tower sites throughout Nigeria, subject to regulatory approval. Under the terms of the transaction, IHS will acquire the entire issued share capital of HTN from HTN Towers Plc, which is ultimately owned by Helios Investment Partners, Pembani Group, First City Monument Bank and other minority shareholders. Upon completion of the transaction, IHS will have full operational control of the underlying business and will market independent infrastructure sharing services to mobile network operators and ISPs in Nigeria. The transaction is expected to close in Q2 2016.

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