Vodafone sells passive mobile tower assets to private equity firms

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Vodafone sells passive mobile tower assets to private equity firms

Vodafone New Zealand has sold the passive tower assets of its mobile network to private equity firms Northleaf Capital and InfraRed Capital Partners, with its existing part-owner Infratil taking a stake in a new business entity set up to manage the sites.

The deal is worth $1.7 billion, and covers 1484 towers wholly owned by Vodafone.

Under the deal, Northleaf and InfraRed will each own 40 per cent of the newly form TowerCo, with Infratil, which together with Brookfield Asset Management owns Vodafone NZ, taking a 20 per cent stake.

InfraRed has offices in London, New York, Sydney and Seoul, and manages US$12 billion worth of funds.

The investor has recently bought fibre broadband providers in smaller sized deals.

UK and North America-based Northleaf Capital manages US$20 billion in funds.

Vodafone's sale of the towers, which does not include radio access network equipment and spectrum rights, follows telco incumbent Spark last week selling 70 per cent of the passive assets of its cellular sites, for $900 million.

The telco said it will take out a 20-year lease from the new TowerCo for access to existing and new towers, with the right to extend.

TowerCo has committed to building a further 390 cellular sites over the next decade.

The transaction estimates earnings for the new TowerCo at $50.3 million for the 2023 financial year.

Expected to be completed in the fourth quarter of this year, the deal is subject to approval from the government's Overseas Investment office.

Vodafone said the deal is contingent on the "completion of certain reorganisation steps" but did not specify what those are.

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© CRN New Zealand

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