by Anshuman Daga, Pamela Barbaglia and Andres Gonzalez
SINGAPORE/LONDON (Reuters) – Infrastructure funds have approached Vodafone to invest in its $16 billion Vantage Towers mobile phone tower company, but the giant telecoms would rather favor a merger with another player in the sector, sources familiar with the matter told Reuters.
Potential buyers, including investment firms Brookfield and Global Infrastructure Partners (GIP), have submitted unsolicited proposals in recent weeks valuing Vantage Towers at a premium to its current valuation, one of the sources said, on condition of anonymity.
The offers are for a majority stake in Vantage Towers, the source said, adding that Vodafone was studying the proposals and had not made any decision.
Vantage Towers shares were up 11.4% at 0926 GMT after rising 5% in early trading following reports from Reuters of the proposed takeover.
The title Vodafone gained for its part 1.4%, thus outperforming the sector, broadly unchanged.
Vodafone, which floated Vantage Towers on the Frankfurt stock exchange last year and still owns 81% of the company, has been reluctant to enter into talks with financial investors. The British group is seeking an industrial merger of Vantage with DFMG, Deutsche Telekom’s tower unit, or with Orange’s Totem, two separate sources said, but said no deal was imminent.
Vodafone, Orange and Brookfield declined to comment for this information, while GIP was not immediately available for comment.
A Deutsche Telekom spokesperson said the company was reviewing strategic options for its infrastructure business, without giving further details.
Earlier this month, Reuters reported that Deutsche Telekom had launched the sale of its tower business, with indicative offers expected in mid-March.
One of the sources said that while Vodafone is closely monitoring the sale of the Deutsche Telekom towers, it is more likely to pursue a deal with Orange’s Totem due to antitrust regulations in Germany.
This source ruled out the possibility of an agreement with financial investors, saying that at this stage, only an industrial merger was possible.
(Report Anshuman Daga, Pamela Barbaglia and Andres Gonzalez, French version Augustin Turpin, edited by Jean-Michel Bélot)
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