Vantage Towers deal confirmed
In a release, Vodafone Group has confirmed ME’s report that is has agreed to sell a stake in its towers unit to private equity funds KKR, PIF and Global Infrastructure Partners in a deal that values its Vantage Towers subsidiary at €16.2 billion ($16.3 billion).
The UK mobile operator detailed the €32-a-share deal for Frankfurt-listed Vantage Towers in a press release which said the price represents a 12% premium to Vantage’s closing price on Monday. Vodafone will move its 81.7% holding in Vantage into a joint venture (JV) with KKR and GIP. The JV will then make a takeover offer for outstanding shares in Vantage in what Bloomberg has described as “the biggest take private of a German company on record.” RRJ Capital, the second-largest minority investor in Vantage, will support the offer. The KKR and GIP consortium will eventually own as much as 50% of the JV.
At worst the cash proceeds to Vodafone will be around €3.2 billion, while optimists at Vodafone might expect €5.8-7.1 billion, depending on the take up in the voluntary takeover offer and subject to GIP and KKR raising further equity before closing to increase their stake in the JV to 50%.
Vodafone Group Chief Executive Nick Read described the deal as a landmark moment for both Vodafone and Vantage Towers. “This transaction successfully delivers on Vodafone’s stated aims of retaining co-control over a strategically important asset, de-consolidating Vantage Towers from our balance sheet to optimise capital structure and generate substantial upfront cash proceeds for the Group to support our priority of deleveraging,” said Read.
Will Brilliant, Partner and Head of Digital Infrastructure at GIP said the private equity fund holder was looking forward to capturing the exciting value-creating opportunities in the European telecoms infrastructure sector. Vincent Policard, Partner and Co-Head of European Infrastructure at KKR said everyone in the consortium has a shared goal of creating a pan-European telecoms champion.