Unlike many mobile network operators around the world that have sold most or all of their tower infrastructure, Canada’s major telecommunications companies — Roger Communications (NYSE: RCI), BCE’s Bell Canada (NYSE: BCE) and Telus Corporation (NYSE: TU) — have not done so. These companies have long argued that owning and operating their own infrastructure is important for managing operating costs and maintaining a competitive edge. Inside Towers Intelligence estimates that Canadian carriers still own roughly 95 percent of their towers. By comparison, European MNOs own less than one-third, while U.S. carriers hold less than 10 percent of their towers.
Recently, shareholder pressure to reduce debt amid slower growth prospects and agile competitors has led these companies to reconsider their stance. They are now exploring the possibility of selling some or all of their towers and other non-core infrastructure assets. For instance, Rogers sold a minority stake in its wireless backhaul subsidiary to Blackstone for $5 billion, as reported by Inside Towers. Similar deals may follow.
In its 4Q24 earnings call, BCE announced it was conducting a strategic review of non-core assets to identify monetization opportunities where it is feasible. In March, Telus declared it was selling a minority stake in its nationwide tower network, estimated to be worth over $1 billion, according to The Globe & Mail.
Generating funds through infrastructure sales to reduce debt is a primary goal. Company reports indicate that Rogers, Bell, and Telus collectively owe more than $77 billion in long term debt, accumulated through years of spectrum purchases, acquisitions, and network expansion. Additionally, factors such as a saturated market, slowing immigration growth, and high-interest rates are contributing to slower growth, as noted by The Globe & Mail. Selling assets, valued at billions of dollars, could quickly raise substantial cash and help lower their debt leverage.
Reducing capital expenditures and operating expenses is another goal. Bell and Telus already share RAN equipment on each other’s towers within their respective geographic strongholds. Smaller MNOs like Quebecor’s Freedom Mobile have over 60 percent of their cell sites colocated on other incumbents’ networks, according to an analysis by the Bank of Nova Scotia.
Investment money is available from private equity firms, pension funds, insurance companies, and family offices that have shown interest in telecom infrastructure assets in recent years.
Telus and Rogers are each selling only a minority stake in their assets, indicating a desire to retain control while adhering to Canadian government regulations that limit foreign purchases of critical Canadian assets. Canada’s current trade tension with the U.S. adds complexity to the potential sale of critical assets to American firms.
By John Celentano, Inside Towers Business Editor
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