Globe sells 5K towers in P71-billion deal




The Manila Times

Corporate News

GLOBE Telecom Inc. on Friday said they signed two sale and lease back deals that involved more than 5,000 telecom towers for P71 billion. In a statement, Globe said they made the disclosure at the Philippine Stock Exchange. According to the Globe statement, they first signed a deal with Miescor Infrastructure Development Corp. (MIDC) over the sale of 2,180 telecom towers as well as passive telecom infrastructure for over P26 billion. They then decided to lease back the towers for an initial 15-year period. MIDC is an independent tower company and is a joint venture between Miescor, a Meralco subsidiary, and infrastructure and real estate investment firm Stonepeak. Globe said that they are expecting a pre-tax transaction gain of over P10.6 billion. “This longer tenor provides Globe with more stability and certainty with regard to the use of this passive infrastructure, which is critical to its core telco service,” the statement said. The statement further noted that they expect the first closing for the transaction to occur within the third quarter of the year, and the succeeding closings will come in next as and when closing conditions are met. The next transaction occurred with 3,529 telecom towers that were sold to the Frontier Tower Associates Philippines Inc. for P45 billion. They likewise agreed to lease it back to Globe for an initial period of 15 years. The statement said that the company is in advanced discussion with one other tower company for the potential sale and leaseback of an additional 1,350 telecom towers and related passive telecom infrastructure. This would mean that the portfolio is made up of towers located in the Visayas and Mindanao. Globe, likewise, expects to sign the sale and leaseback agreement with this tower company within the third quarter. The company said that they are planning to sell 7,059 towers, of which 66 percent are located in Luzon, 19 percent in Mindanao and 15 percent in Visayas. Globe said 75 percent of the expected amount to be raised from the transaction will fund its capital expenditure, support ongoing network expansion, and sustain industry-leading network consistency and reliability scores. The remaining 25 percent will be allocated to cover the telco’s 2023 debt-servicing requirements.