Spanish infrastructure operator Cellnex and Germany’s Deutsche Telekom (DT) have announced an agreement to combine their tower assets in the Netherlands. Under the deal, Cellnex will integrate T-Mobile Infra’s 3,150 telecommunications towers and sites in the Netherlands, with the companies becoming the anchor investors in the newly-created Digital Infrastructure Vehicle (DIV) fund focused on European digital infrastructure. The fund will hold a 38 percent stake in Cellnex Netherlands as a seed asset and will receive EUR 200 million in capital from Cellnex plus EUR 400 million from DT in the form of an asset contribution.
Cellnex and T-Mobile Netherlands will also sign a 15 year long-term provision contract, automatically renewable for 10-year periods, that includes the rollout of 180 new sites over the next 7 years. In its statement, Cellnex said the estimated EBITDA contribution of the transaction will amount to around EUR 63 million, while Recurring Leveraged Free Cash Flow (RLFCF) will increase by around EUR 30 million.
The Spanish group’s presence in the Netherlands dates back to 2016, when it acquired Protelindo and Shere Group, followed in 2017 by Alticom, a total investment of around EUR 492 million. The deal with DT will increase its current portfolio in the country from 984 to 4,314 sites, including the new build, converting the merged entity into the leading independent telecommunications tower company in the Netherlands, said the partners.
Cellnex chief executive Tobias Martinez said the alliance with DT would enable the company to consolidate its position as a key player in the Dutch market by gaining assets in exchange for equity in its local subsidiary. “We are presenting to the market a new growth operation that preserves and protects our capacity to take on more projects by not consuming financial resources from the group,” he said.
The new independently-managed DIV fund is expected to seek investments in European digital infrastructure assets with attractive risk-adjusted returns such as fibre, towers and data centres. Cellnex added that it has also signed a “dealflow agreement” with DIV whereby the two entities can partner on future transactions in the European tower sector, in which Cellnex will have the right to co-invest with a stake of 51 percent.
The deal comes just over a week after Cellnex closed the acquisition of CK Hutchison's telecommunications tower assets in Austria, Denmark and Ireland, three of the six countries covered by the agreement reached with the parent company of mobile operator 3 Group last November.
The EUR 10 billion transaction was the seventh major acquisition announced by Cellnex last year, an aggressive M&A strategy that has converted the group into Europe’s biggest towers company with around 103,000 sites including planned rollouts. It expects the transactions in Sweden, Italy and the UK to close in the coming months.
