Vodafone Group plans to carve out its phone towers into a separate unit and consider an initial public offering, as it seeks to sell substantial stakes in the business to lower its debt.
It’s the boldest move yet by a European carrier to take advantage of private equity demand for telecom infrastructure.
The business will own the continent’s largest tower portfolio of 61,700 masts in 10 countries, Vodafone said in a statement on Friday.
The separation, which will take effect by May 2020, follows a review started last year by Vodafone chief executive officer Nick Read to consider ways to monetize the company's infrastructure to help the cash-constrained carrier fund the rollout of fifth-generation mobile services. Vodafone said it's received several offers for various parts of the tower portfolio.
Tower sharing
Since then, Read has been pursuing tower-sharing with rivals and overhauling existing deals, including with Telefonica’s O2 in the UK and Telecom Italia SpA. (INWIT).
Vodafone announced the towers plans alongside fiscal first-quarter financial results that beat analysts’ estimates.
Organic service revenue fell 0.2 per cent, compared with the average analyst estimate for a decline of 0.6 per cent, according to a company-compiled consensus. – Bloomberg
