Deutsche Telekom to sell 51% of towers business

LONDON/BERLIN, July 14 (Reuters) – Deutsche Telekom (DTEGn.DE) has agreed to provide 51% of its towers small business to a consortium of Canada’s Brookfield and U.S. non-public fairness organization DigitalBridge after they made a surprise previous-minute bid that valued the unit at 17.5 billion euros ($17.5 billion).

Brookfield (BAMa.TO) experienced initially assisted to fund a binding bid by Spanish telecoms agency Cellnex (CLNX.MC), ahead of Cellnex withdrew on Wednesday. go through additional

The German telecoms large will retain the remaining 49% stake of the GD Towers organization, with the deal envisioned to near toward the end of the 12 months.

Proceeds of 10.7 billion euros will assist Deutsche Telekom cut personal debt, even though it performs towards acquiring a greater part share in its T-Cell U.S. subsidiary.

“We crystalise the price of our tower property, thus making benefit for our shareholders,” Deutsche Telekom CEO Tim Höttges stated.

Brookfield and DigitalBridge (DBRG.N) “have deep pockets for the coming methods,” Höttges additional, indicating their position in fostering business consolidation throughout a media briefing.

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

The offer is Germany’s major this year and Europe’s next biggest, after the Benetton spouse and children and U.S. fund Blackstone’s (BX.N) 58 billion euro takeover of Italian infrastructure team Atlantia (ATL.MI). study extra

The towers sale kicked off in March, drawing interest from heavyweight economic investors which includes U.S. buyout fund KKR (KKR.N) which teamed up with World Infrastructure Partners (GIP) and Stonepeak on a rival bid. browse a lot more

Quite a few telecoms corporations have carved out towers organizations, or introduced joint ventures with other providers, to increase dollars even though retaining a stake in functions.

Goldman Sachs suggested Deutsche Telekom on the sale, even though Perella Weinberg Companions, Evercore and Barclays labored with DigitalBridge alongside law companies Allen & Overy and Morgan Lewis.

With around 800 employees, GD Towers operates radio towers at extra than 40,000 areas in Germany and Austria. In 2021, the corporation achieved profits of close to 1.1 billion euros.

Vodafone’s Frankfurt-listed towers business enterprise Vantage Towers (VTWRn.DE) and American Tower (AMT.N) experienced viewed as bids before in the auction process. examine additional

“The partnership being formed today is about constructing the next generation electronic infrastructure champion of Europe,” said DigitalBridge CEO Marc Ganzi.

The infrastructure expenditure firm manages $47 billion of property concentrated on electronic infrastructure these kinds of as wi-fi towers, facts facilities and fiber networks.

($1 = .9981 euros)

Reporting by Emma-Victoria Farr in London and Matthias Inverardi in Duesseldorf
Composing by Rachel A lot more in Berlin Editing by Jacqueline Wong and Mark Potter

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