Australia’s TPG Telecom is to sell its mobile phone tower assets for $670 million to reduce its debt.


The sale of the passive infrastructure assets, which comprise more than 1,200 sites and form almost one-fifth of TPG’s mobile network footprint, will generate net cash proceeds of A$890 million, which will be used to pay off bank debt, he said.

Passive infrastructure includes sites, buildings, towers, pylons and poles, and excludes the digital capabilities of active telecommunications networks.

“The transaction represents competitive long-term financing, which will reduce our total financial leverage and reduce borrowing costs,” said Iaki Berroeta, Chief Executive Officer of TPG.

The sale is the latest in a string of deals in Australia’s telecoms sector, where companies are increasingly looking at options for their aging infrastructure to reduce debt and try to capitalize on 5G growth .

Last year, the country’s biggest telecommunications company, Telstra, agreed to sell a 49% stake in its mobile phone tower business for A$2.8 billion. Last month, Uniti Group also agreed to a takeover for AUD 3.6 billion.

Toronto-headquartered OMERS had C$32 billion ($24.8 billion) in assets under management and investments in 12 countries at the end of last year, according to its website.

The transaction marks OMERS’ first wholly owned Australian investment and its first foray into digital infrastructure in the Asia-Pacific region. It has already invested in the German fiber optic wholesale company Deutsche Glasfaser and the French company XP Fibre.

“Australia and broader Asia-Pacific are priority markets for OMERS, where we continue to see significant investment opportunities,” OMERS said in a statement.

TPG said it will recognize a gain of approximately A$350 million to 400 million after tax as a result of the transaction.

The transaction is subject to approval by Australia’s Foreign Investment Review Board and is expected to close in the third quarter of fiscal 2022, TPG added.

Shares of TPG traded roughly flat at A$5.54 0021 GMT, while the broader market was down almost 1%.

($1 = 1.4178 Australian dollars)

($1 = 1.2915 Canadian dollars)



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