Vodafone New Zealand, the country’s largest telecom operator and based in Auckland, announced last week that it now expects binding bids for its tower unit to be submitted by July 15, according to Total Telecom.
The company is offering an 80 percent stake in its tower unit. Three bidders are still in the running: KKR-backed John Laing; a joint bid from Northleaf Capital and InfraRed Capital Partners; and another joint bid from Ontario Teachers’ Pension Plan and NZ Super.
Vodafone NZ currently owns around 1,500 towers, with an estimated valuation of close to $1 billion.
Vodafone is not the only New Zealand telecom company in the process of offloading its mobile towers. Its rival, Spark, formerly Telecom New Zealand, is also preparing to auction a 70 percent stake in its tower unit. Two weeks ago, Spark said that it had narrowed the prospective bidder list down to five companies. Indicative bids were expected by the end of last week.
New Zealand’s third-place mobile player, 2degrees, is still on the sidelines, with no apparent plans to sell its roughly 1,800 mobile towers. The company is currently focused on integrating its operations, following the roughly $1 billion merger with Vocus in early June. Selling its towers may be a future consideration.
Investor interest in passive mobile assets has been extremely high in recent years, with major mobile network operators around the world spinning off their infrastructure units. Selling tower assets provides a cash infusion that the MNO can use to reduce debt and to accelerate their rollout of next-generation technology.
In nearby Australia, recent tower deals have raised substantial sums of money for their respective telcos. Last year, Telstra sold a 49 percent stake in its tower unit InfraCo for $2.1 billion and Optus sold 70 percent in Australian Tower Network for $1.3 billion, as Inside Towers reported. In May, TPG Telecom Limited, the third largest wireless carrier (operating as Vodafone Australia) and fixed broadband provider in Australia, announced that it would sell 100 percent of its passive mobile tower and rooftop infrastructure, comprising 1,237 existing sites, to OMERS Infrastructure Management for around $650 million, according to Digl Infra.
Achieving similar valuations in New Zealand is still to be determined.
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