Telefónica carves out infrastructure business, mulls IPO for new Telxius unit
Telefónica created a new business unit that in future will be responsible for the management of its mobile towers and submarine optical fibre network in order to better optimise the company's global asset portfolio.
The Spain-based operator said around 15,000 towers in Spain and other countries and its 31,000 km submarine cable will initially be brought into the new unit, called Telxius. The company has also proposed Alberto Horcajo as CEO of the unit.
Telxius could also be listed in future. "In relation to Telxius, Telefónica is analysing alternative strategies, including a possible initial public offering," the company said in a statement to market regulator CNMV, Reuters reported.
Telefónica had previously indicated that it planned to carve out its infrastructure business including 11,500 towers in Spain, with a view to a possible listing or sale of the business.
A recent report by TowerXchange, which specialises in research into the telecoms tower industry, noted that this move was part of a general trend among operators in Europe to hive off and divest their mobile towers.
Indeed, the research company predicted that around 23 per cent of European mobile towers could end up under the ownership of independent tower companies this year. As things stand, independent companies own 18 per cent of Europe's 600,000 sites.
In other deals, VimpelCom has moved into the next stage of bidding for the sale of its 10,400 Russian towers; Telecom Italia confirmed three bids for the imminent sale of a stake in its infrastructure business, Inwit; and Turkcell has opened discussions with bankers regarding a potential sale of its 7,500 towers in Turkey.
VimpelCom's towers in the CIS, MTS and MegaFon's towers in Russia, and Orange's towers in Poland are also subject to sale speculation.
Telefónica noted that Telxius would provide a more specialised and focused approach, with the aim of increasing the services provided to other operators, improving the return on capital invested and allowing Telxius to participate more actively in the growth opportunities that exist in the industry. This includes the possibility of incorporating third-party assets.
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