Deutsche Telekom to sell 51% of towers business

LONDON/BERLIN, July 14 (Reuters) – Deutsche Telekom (DTEGn.DE) has agreed to promote 51% of its towers company to a consortium of Canada’s Brookfield and U.S. non-public fairness company DigitalBridge soon after they produced a shock past-minute bid that valued the device at 17.5 billion euros ($17.5 billion).

Brookfield (BAMa.TO) had at first served to fund a binding bid by Spanish telecoms business Cellnex (CLNX.MC), just before Cellnex withdrew on Wednesday. read a lot more

The German telecoms large will maintain the remaining 49% stake of the GD Towers small business, with the deal predicted to close to the conclusion of the year.

Proceeds of 10.7 billion euros will enable Deutsche Telekom slash personal debt, when it operates in the direction of acquiring a the vast majority share in its T-Cellular U.S. subsidiary.

“We crystalise the worth of our tower assets, thereby making worth for our shareholders,” Deutsche Telekom CEO Tim Höttges reported.

Brookfield and DigitalBridge (DBRG.N) “have deep pockets for the coming ways,” Höttges additional, indicating their role in fostering industry consolidation during a media briefing.

Deutsche Telekom shares have been down 1.6% at 1102 GMT.

The deal is Germany’s major this calendar year and Europe’s next largest, soon after the Benetton household and U.S. fund Blackstone’s (BX.N) 58 billion euro takeover of Italian infrastructure team Atlantia (ATL.MI). read through far more

The towers sale kicked off in March, drawing focus from heavyweight economical buyers such as U.S. buyout fund KKR (KKR.N) which teamed up with International Infrastructure Associates (GIP) and Stonepeak on a rival bid. go through a lot more

Quite a few telecoms corporations have carved out towers corporations, or launched joint ventures with other providers, to raise income when retaining a stake in operations.

Goldman Sachs suggested Deutsche Telekom on the sale, although Perella Weinberg Associates, Evercore and Barclays labored with DigitalBridge alongside law corporations Allen & Overy and Morgan Lewis.

With all over 800 staff, GD Towers operates radio towers at far more than 40,000 places in Germany and Austria. In 2021, the enterprise obtained income of close to 1.1 billion euros.

Vodafone’s Frankfurt-outlined towers business enterprise Vantage Towers (VTWRn.DE) and American Tower (AMT.N) experienced thought of bids earlier in the auction system. study far more

“The partnership becoming fashioned today is about making the up coming era digital infrastructure champion of Europe,” stated DigitalBridge CEO Marc Ganzi.

The infrastructure expenditure organization manages $47 billion of belongings concentrated on electronic infrastructure these types of as wi-fi towers, details centers and fiber networks.

($1 = .9981 euros)

Reporting by Emma-Victoria Farr in London and Matthias Inverardi in Duesseldorf
Producing by Rachel More in Berlin Modifying by Jacqueline Wong and Mark Potter

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