Telenet has entered into a binding agreement to sell its mobile tower business to DigitalBridge Investments, an affiliate of DigitalBridge Group, in an all-cash transaction valued at EUR745 million (USD819 million) on a cash-free and debt-free basis. As part of the deal, Telenet will enter into a long-term Master Lease Agreement with DigitalBridge, which includes an initial period of 15 years and two renewals of ten years each. The agreement also includes a build-to-suit commitment to deploy a minimum of 475 additional new sites with Telenet acting as a subcontractor to TowerCo, resulting in additional proceeds to Telenet over time. The transaction is expected to close in the second quarter of 2022 and does not require any further regulatory approvals.
The transaction consists of a portfolio of 3,322 sites across Belgium, including 2,158 owned sites, of which nearly 38% are towers, and 1,164 third-party sites. The tenancy ratio across the entire portfolio is 1.2x and 1.6x on towers specifically. On a pro forma basis to reflect Telenet’s anchor tenant fee and the regulated site sharing fees received from other tenants, Telenet’s passive infrastructure business generated revenue of EUR61.2 million, adjusted EBITDA of EUR55.1 million and adjusted EBITDAal of EUR29.7 million for FY21.
Commenting on the deal, Marc Ganzi, President and CEO of DigitalBridge, said: ‘Telenet’s tower business is a high-quality digital infrastructure asset with stable, predictable cashflows, high cash conversion, and long-term contracts. This transaction is the latest example of DigitalBridge’s commitment to working with leading telecom and technology companies globally to help them unlock embedded value in their networks via creative solutions built on long-standing relationships and a proven track record of successfully operating assets. We see significant headroom for growth in the Belgian telecom market through the enhancement of mobile penetration and data usage, and we look forward to meeting and exceeding Telenet’s increased coverage needs.’