China Tower, which owns and manages mobile tower infrastructure on the Chinese mainland for all three of the nation’s cellular providers, has invited investment banks to submit proposals for a role in the firm’s initial public offering (IPO) in Hong Kong, Reuters writes citing IFR. The IPO is due to take place between Q4 2017 and Q2 2018 and is expected to raise up to USD10 billion. As noted by TeleGeography’s GlobalComms Database, China Tower was established in September 2014 – though it did not begin operations for more than a year after that date – to pool the tower assets of the three mobile network operators (MNOs) and minimise the unnecessary duplication of infrastructure, allowing the cellcos to more efficiently invest in network development. China Mobile currently holds the largest stake in the firm (38.0%) having transferred the largest number of sites to the operator, whilst smaller cellcos China Unicom and China Telecom hold stakes of 28.1% and 27.9%, respectively. The remaining 6.0% is held by state asset-management organisation China Reform Holding.
Swiss full service provider Sunrise has agreed to sell 2,239 telecom towers to a consortium led by Spanish-based infrastructure group Cellnex Telecom (54%) and comprising Swiss Life Asset Management (SLAM, 28%) and Deutsche Telekom Capital Partners (DTCP, 18%) for a total consideration of CHF500 million (USD513 million). Sunrise had spun off the towers into a separate company, Swiss Towers, in March this year to pave the way for the sale. As part of the sale agreement, Sunrise entered into a 20-year service contract with the consortium and will also sign a new build-to-suit expansion programme, consisting of new macro sites and small cells. For its part, Cellnex notes that 32% of the Swiss Towers sites are in urban areas, 41% in suburban areas and 27% are rural.
Canadian asset management firm Brookfield Infrastructure Partners is looking towards further expansion in India and is in talks with mobile operators Idea Cellular and Vodafone India to buy their respective tower businesses, the Economic Times writes, citing three people familiar with the matter. According to one of the sources, negotiations regarding valuations are ongoing but should be finalised shortly, with the duo reportedly pushing for a valuation of around USD1.3 billion for the towers. Each of the cellcos controls roughly 11,000 towers apiece, either directly or via a subsidiary, whilst both also have a stake in tower joint venture Indus Towers. Brookfield is currently in the process of concluding a deal to acquire the wireless tower assets of Reliance Communications’ (RCOM’s) infrastructure division Reliance Infratel (RITL) for a total consideration of INR110 billion (USD1.7 billion).
In the UK, meanwhile, the sale process for tower provider Arqiva – which, in addition to its cellular towers, holds a monopoly on Britain’s TV and radio broadcast infrastructure – is set to formally begin, the Telegraph reports. The operator is expected to fetch in the region of GBP6 billion (USD7.7 billion), with interested parties including: Spain’s Cellnex Telecom; Cheung Kong Infrastructure Holdings (CKI), the holding company of Hong Kong’s richest man Li Ka-shing; Singapore’s sovereign wealth fund GIC; private equity firms Kohlberg Kravis Roberts (KKR) and 4M Investments; Germany’s Allianz; and French infrastructure firm TDF Group.
Mexican billionaire Carlos Slim is looking to sell a minority stake in Mexican wireless tower company Telesites, Reuters cites people familiar with the matter as saying. The business was spun out of America Movil (AM) in 2015 but has reportedly struggled to find tenants for its towers other than AM and its mobile division Telcel. According to the sources, Mr Slim has begun talks with private equity firms, sovereign wealth funds and infrastructure management groups regarding the sale of a part of his roughly 61% stake in Telesites, though the businessman intends retain control of the company.
India tower industry body the Tower and Infrastructure Providers Association (TAIPA) has warned that the country’s towercos will pass on their 18% tax burden under the proposed Goods and Services Tax (GST) regime to service providers, potentially driving up costs for customers, or placing additional financial pressure on struggling cellcos, the Financial Express reports. Under the proposed GST rules, tower companies will need to pay an 18% tax on the services they provide to telecom operators, whilst those cellcos will also be liable for an 18% levy on their own services (up from the current level of 15%). The lack of input tax credit or tax refund provision for towercos, however, will force infrastructure providers to pass on the additional cost to their customers, TAIPA Director General Tilak Raj Dua commented, adding that the group had flagged the issue during a number of discussions with the government.
Staying with India, the Supreme Court has issued a stay on a Rajasthan government order directing mobile providers to remove cell towers from within 500 metres of prisons across the state. The Economic Times reports that the initial order was given in April/May this year, on the grounds that an August 2012 policy barred the installation of mobile towers within 500 metres of jails. The Rajasthan government gave the cellcos 30 days (ending early June) to decommission the relevant sites. In its appeal, the Cellular Operators Association of India (COAI) argued that the 2012 policy had been overturned by a February 2017 policy which allowed for the installation of cell towers in public and private locations including parks, hospitals, schools and government owned or controlled buildings. The COAI stressed that the order would have a cascading effect, impacting around eight million people as the exercise would require the removal of 400 towers, including base station controller sites catering to a further 2,500 base transceiver stations (BTS).
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