Telefonica has change into the newest European telco to make the most of third-party curiosity for cellular infrastructure and agreed a deal to promote its European and Latin American masts to the American Tower Firm (ATC).
The €7.7 billion sale of its Telxius subsidiary contains 30,772 masts throughout Argentina, Brazil, Chile, Germany, Peru and Spain however not the UK the place O2’s masts are shared with O2 as a part of the Cornerstone joint-venture.
The deal contains preparations for Telefonica’s operators in every nation to proceed to make use of the infrastructure and ATC instantly turns into Telefonica’s main provider in each areas.
Telefonica mast sale
Telefonica had already indicated it deliberate to cut back its presence in Latin America exterior of Brazil as a part of a wider strategic shift. It plans to concentrate on its core European markets and to change into a extra sustainable enterprise.
The proceeds from the sale will likely be used to cut back Telefonica’s debt because it seeks development alternatives, most notably the deliberate joint-venture within the UK with Virgin Media.
“It is a deal that makes strategic sense inside our roadmap. American Towers was our second provider after Telxius,” stated José María Álvarez-Pallete, Telefonica President. “After this nice operation we are going to proceed to concentrate on our most bold aims: the mixing of O2 with Virgin in the UK, the acquisition of Oi cellular in Brazil and the discount of debt.”
A number of European operators have moved to promote their passive cellular infrastructure prior to now 12 months, hoping to boost capital. Non-public fairness companies worth the predictable, secure revenues guarantees by masts and demand for 5G companies means there’s scope for development.
This long-term view contrasts with the short-term pressures that community funding imposes on cellular operators who’re in the midst of costly community builds. An impartial operator would additionally have the ability to agree offers with a number of operators, growing revenues.
Three’s mother or father CK Hutchison has bought its mast property throughout Europe to Cellnex for €10 billion, whereas Vodafone has spun off its towers into an impartial subsidiary that’s anticipated to drift later in 2021.