Deutsche Telekom has agreed to sell a 51% stake in GD Towers to DigitalBridge and Brookfield at an enterprise value of €17.5 billion on a cash and debt free basis.
Under the terms of the transaction, which is subject to usual regulatory approvals and expected to close towards the end of this year, Telekom will retain a 49% stake in the company, which operates more than 40,000 sites in Germany and Austria and generated €1.1 billion of pro forma revenues in 2021.
Commenting on the transaction, Tim Höttges, CEO of Deutsche Telekom, said: “Deutsche Telekom once again delivers on its strategic agenda. We crystalise the value of our tower assets, thereby creating value for our shareholders.
“At the same time the deal allows us to continue improving Deutsche Telekom’s undisputed network leadership in Germany and benefit from further value upside of the towers business through our retained 49% stake”.
Marc Ganzi, CEO of DigitalBridge, added: “The partnership being formed today is about building the next generation digital infrastructure champion of Europe.
“The combination of Deutsche Telekom’s leading mobile network and market position, alongside one of the largest real asset managers in the world in Brookfield, combined with the digital infrastructure domain expertise of DigitalBridge, creates a team of unmatched capabilities to support GD Towers as it grows to meet the evolving network demands of enterprises and consumers across Europe”.
Sam Pollock, managing partner at Brookfield and CEO Infrastructure, said: “We’re delighted to be partnering with Deutsche Telekom and DigitalBridge to expand our presence in the European telecom infrastructure sector.
“This represents a great opportunity to invest in a highly attractive tower portfolio, with highly contracted cash flows and strong upside potential. Brookfield is already a leading global infrastructure investor, with approximately 200,000 telecom tower and rooftop sites under management globally. We hope to bring that experience and expertise to this new partnership, for the benefit of our customers in Germany, Austria and beyond”.
The digital infrastructure firm DigitalBridge and Canada’s Brookfield both have substantial exposure to the European towers sector. Furthermore, the transaction will reduce Telekom’s debt by €10.7 billion.
The current GD Towers leadership team with Bruno Jacobfeuerborn (CEO) and Thomas Ried (CFO) will continue running the business after the deal is closed.