supply
The sale will be of ‘passive elements’ of all towers, including structures, fences and buildings.
Vodafone will sell its mobile towers for $1.7 billion if approved by the Overseas Investment Office.
The deal will create a new company, Twerco, which will have 1,484 mobile towers, making it the country’s largest operator, covering more than 98% of New Zealand’s population.
Under the terms of the deal, which is subject to the approval of the Foreign Investment Office and the completion of certain restructuring phases, the new Towerco is a 20-year master service agreement with Vodafone NZ to provide Vodafone with access to both the existing and new towers. Tverco’s commitment to construct at least 390 additional sites over the next 10 years to enhance coverage and capacity position relative to Vodafone.
Vodafone New Zealand, owned by Infratiland Brookfield Asset Management, announced the sale on NZX this morning.
Read more:
*2Degree and Orcon to merge with $1.2 billion revenue company
* Detail: Is Infratil too important to be sold offshore?
* Vodafone owner Infratil rejects AustralianSuper’s $5.4 billion takeover offer, shares jump
Tom Puller-Strecker/Stuff
Vodafone will now seek the approval of the Foreign Investment Office for the sale of over 1000 passive mobile towers.
The mobile towers will be sold to funds managed or advised by global investors Infrared Capital Partners and Northleaf Capital Partners.
Both will hold 40% of the new company, Infratil will hold the reinvestment and 20% of the new company.
If this is extended, Towerco will enter into a 20-year servicing agreement with Vodafone, with expansion rights, giving Vodafone access to both existing and new towers.
Towerco is also committed to constructing at least 390 additional sites over the next 10 years to increase coverage and capacity.
Vodafone will continue to operate parts of its network, which include radio access equipment and spectrum assets.
Infratil and Vodafone announced on 7 March that they were entering the market for a possible sale of Vodafone’s defunct mobile towers.
The transaction is expected to be completed in the fourth quarter of the 2022 calendar year, subject to the approval of the Foreign Investment Office.
Vodafone sold Vodafone NZ to Kiwi company Infratil and Canadian firm Brookfield Asset Management for $3.4 billion in May 2019.
The sale covers all Vodafone towers, except those that fall under the Rural Connectivity Group a company owned by three New Zealand mobile network operators 2Degree, Spark and Vodafone.
While the towers will be owned by Twerco, the equipment operating on them (including antennas and cables, power equipment and radio equipment) will not be sold.
supply
A diagram showing what will be sold in gray and what will not, in red.
new owner
Infrared is a global investment manager focused on infrastructure and real estate with offices in London, New York, Sydney and Seoul.
Northleaf is a global private investment firm headquartered in Canada, with offices in North America and London and Melbourne.
In its announcement to NZX, Infratil said the move will allow exclusive ownership of passive mobile towers, driving efficiency, which will prove critical as demand for data and connectivity increase.
While Vodafone will sell a substantial portion of its assets, the deal will increase earnings before interest, taxes, depreciation and amortization by nearly 34 times.
Infratil Chief Executive Jason Boyce said Vodafone was an excellent Infratil investment.
supply
The sale does not include antenna and cable, power equipment and radio equipment on towers.
We have unlocked a significant portion of the value of our core equity invested in Vodafone, while maintaining that investment and a 20% stake in Towerco.
Brookfield Infrastructure Managing Director Uday Mathyalgan said the partnership will increase site options for wireless operators in New Zealand.
Vodafone CEO Jason Paris said the potential sale of mobile towers attracted significant interest.
Morrison & Company Chief Investment Officer Will Smalls said Twerco presented an opportunity for Infratil to invest in a difficult-to-replicate national tower network with strong partners.
What makes it an attractive infratilt asset is that while it has long-term, inflation-linked cash flows, it offers significant growth, including macro tower growth, future co-tenancy potential, increased demand for new points of presence. There is also a forum with opportunities. Exit opportunities like small cells. ,
