Cornerstone Telecommunications Infrastructure Limited, headquartered in Berkshire, west of London, operates towers for mobile network operators, Telefónica and Vodafone, in the U.K. The two MNOs each hold a 50 percent share of Cornerstone. Telefonica’s share is through Virgin Media O2 that Telefonica jointly owns with Liberty Global. Vodafone previously transferred its 50 percent of Cornerstone to the Central Tower Holding Company BV, a subsidiary of Vantage Towers, Vodafone’s tower division.
Recent organizational changes at Virgin Media O2 have led to speculation that the company may sell its stake in Cornerstone. The company downplayed the moves as part of an internal reorganization and said that there was no change to Telefónica’s 50 percent stake in Cornerstone.
In its 2022 earnings call, Telefónica CEO Ángel Vilá acknowledged that the company is keeping open all options on Cornerstone’s disposition, however. He characterized Cornerstone as a “very attractive” infrastructure asset because it is one of the few large MNO-owned tower companies in Europe.
Nonetheless, Cornerstone remains one of the most relevant assets that Telefónica could sell to raise capital and reduce debt. Telefónica has already sold most of its tower assets. In 2021, the MNO sold approximately 31,000 towers of its Telxius subsidiary in Europe and Latin America to American Tower for $9.4 billion, Inside Towers reported.
In mid-2022, Vantage Towers expressed an interest in buying the Virgin Media O2 share of Cornerstone. At the time, Vantage Towers CEO Vivek Badrinath suggested that Vantage was the “natural buyer” of the 50 percent of Cornerstone that it does not own.
As of year-end 2022, Cornerstone had around 15,000 sites in its portfolio and long-term lease contracts with Vodafone and Virgin Media O2. In January, Cornerstone hired Pat Coxon as its new CEO, BroadbandTV News reported. Coxen was a senior executive at the Mobile Broadband Network which manages towers for BT and Three UK.
At the beginning of February, Reuters reported that Telefónica and Liberty Global were preparing to invite possible offers for the sale of 25 percent of Cornerstone, with a business valuation of more than $3.6 billion. Both of Cornerstone’s joint owners, Telefonica and Vodafone, are seeking funds to speed up the deployment of their fiber optic networks in the U.K. and received signs of interest from the British Universities Superannuation Scheme pension fund.
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