The Spanish telecom company, Cellnex, which owns the most extensive network of telecom infrastructure in Europe, is set to sell its Irish sector to Phoenix Tower International, a firm based in Florida. The sale amounting to €971 million is an attempt by Cellnex to reduce its debt after five years in the Irish market.
Cellnex ventured into Ireland in 2019 by purchasing Cignal, a tower company that then had 546 tower sites, of which 300 were previously owned by the State’s forestry business, Coillte. This purchase cost Cellnex €210 million. As the years progressed, Cellnex added more sites to its portfolio and in 2021, bought hundreds of towers from Three Ireland, a mobile phone operator owned by CK Hutchison. This purchase cost approximately €600 million and was part of a larger acquisition of CK Hutchison’s assets in Europe amounting to €10 billion.
Cellnex presently handles about 1,900 sites in Ireland, a fraction of the over 9,300 mobile station sites recorded on regulator, ComReg’s website. The company’s exit from Ireland aligns with its broader objective of streamlining operations and concentrating efforts on expanding in its primary markets, according to Marco Patuano, Cellnex’s CEO. The selling value equates to 24 times earnings before rentals, amortisation, depreciation and tax interests.
On the other hand, Phoenix Tower, a company backed by US Blackstone and launched in 2013, currently oversees 29,000 telecom towers across Europe, Latin America, the US and the Caribbean. Phoenix Tower first stepped into the Irish telecom scene four years ago by purchasing Emerald Tower, the owner of more than 650 mobile tower sites, for €300 million from Eir. The purchase covered steel and concrete components, while Eir kept the base stations, antennas and all other telecommunication equipment, including fibre.
In the words of Phoenix Towers’ CEO, Dagan Kasavana, this recent acquisition speaks volumes of their commitment to Ireland’s telecommunications industry and their enthusiasm to assist in the development of advanced and resilient telecommunications infrastructure that’s beneficial to the local people and their esteemed mobile network collaborators.
Last June, Mr Patuano was appointed as the CEO of Cellnex and is now striving to alter the firm’s course, as the preceding management, capitalising on the unprecedentedly low-interest rates, expended approximately €30 billion purchasing towers throughout the continent. Whilst this caused the company’s size to increase over fivefold, it also burdened it with a €20 billion debt.
The pivotal aim of Mr. Patuano, who hails from Italy, is to attain S&P Global Ratings’ investment grade credit rating, since the company already holds one from Fitch. On Tuesday, Cellnex announced their intentions to allocate an estimation of €3 billion on dividends from 2026 to 2030 and potentially spend up to €7 billion on both investments and share buy-backs.
Depending on the success of their debt-reduction plans, Cellnex might contemplate advancing their share buy-backs and dividend payments. Following these announcements, Cellnex shares saw a 1.5% increase in their early Madrid trading.
Phoenix Towers have enlisted Nomura as their sole financial advisor and have Arthur Cox appointed as their legal counsel. On the other hand, Cellnex has engaged both Barclays and Santander as their financial advisors, and selected Matheson as their legal counsel.
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