Spain’s Cellnex sells Irish telecom masts unit for €971m to Phoenix Tower

Phoenix entered the Republic in 2020 buying Emerald Tower, which owns over 650 mobile masts, for €300 million from Eir

Cellnex, Europe’s largest telecom towers and infrastructure group, has agreed to sell its Irish unit for €971 million to Florida-based Phoenix Tower International, exiting the market after five years as it looks to pay down debt.

The Spanish group entered the Republic in 2019 by buying Cignal, a tower firm with 546 tower sites at the time, including 300 that were formerly owned by State-owned forestry company Coillte, for €210 million.

It went on to develop more sites and, in 2021, acquired hundreds more towers from mobile phone operator Three Ireland’s owner, CK Hutchison, for about €600 million. The Three sites were part of a wider €10 billion sale of CK Hutchison assets in Europe to Cellnext.

Cellnext manages 1,900 sites in the Republic. There are more than 9,300 mobile base station sites in the State, according to a map on industry regulator ComReg’s website.

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The Irish disposal is in line with the group’s “goal of consolidating, simplifying our corporate structure and focusing our efforts in the existing growth opportunities in the main markets in which we operate,” said Cellnex chief executive Marco Patuano.

The sale price is equivalent to 24 times earnings before interest, tax, depreciation, amortisation and after leases.

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Phoenix Tower, founded in 2013 and backed by US investments giant Blackstone, operates more than 29,000 telecom towers throughout Europe, the US, Latin America and the Caribbean. Its European markets include France, Italy, Ireland, Germany, Malta and Cyprus.

It entered the Irish market four years ago with the acquisition of Emerald Tower, which owns more than 650 mobile masts, for €300 million from Eir. The sale encompassed steel and concrete elements, with Eir and its affiliates retaining ownership of the base stations, antennae and all telecom-related equipment, including fibre.

“This acquisition demonstrates our commitment to Ireland, and we are eager to contribute to the development of robust and advanced telecommunications infrastructure that will benefit both the Irish people and our valued mobile network operator partners,” said Dagan Kasavana, chief executive of Phoenix Towers.

Mr Patuano, became Cellnex’s chief executive last June, is seeking to change tack after previous management took advantage of historically low interest rates to spend close to €30 billion to buy towers across Europe. The acquisitions made the company grow more than fivefold but also saddled it with €20 billion in debt.

A key goal for the Italian executive is to achieve an investment grade credit rating from S&P Global Ratings by year-end, as it has from Fitch.

Cellnex said on Tuesday that it plans to spend €3 billion on dividends between 2026 and 2030 and spend as much as €7 billion on share buy-backs and investments.

Cellnex may consider earlier share buy-backs and dividend payments depending on the progress of the debt-cutting plans. Cellnex shares rose 1.5 per cent in Madrid in early trading.

Nomura is serving as exclusive financial adviser and Arthur Cox is serving as legal counsel to Phoenix Towers. Barclays and Santander are serving as financial advisers and Matheson is serving as legal counsel to Cellnex.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times