The risks are low, the profitability high. Two qualities that alone justify the attention for the transmission tower sector, “the sexiest sector of the moment”, as the CEO of Vodafone, Nick Read. “I had – he then explained to the Financial Times – many contacts with the protagonists of the sector, who tried to convince me that it would have been better for us to raise cash and leave the field to the specialists. But we too are specialists”. And so Mr. Read, who started with the idea of scraping together a part of the money needed both for 68.000G and to reduce the debts of the English giant with the sale of the 5 towers distributed throughout Europe, he converted to the idea of not quitting the game of rooks. Hence the idea of proceeding to the stock exchange listing of Vantage Towers, protagonist of yesterday's Investor Day in Frankfurt, in view of an IPO which, according to forecasts, promises to be the most important in Europe, with £4bn raised for 20% of the company, estimated at around 17-18 billion euros (a valuation justified by an EBITDA of 56%, or more than double what the parent company, the undisputed leader of the TLCs, collects).
The operation falls a few days after the coup that changed the characteristics of the sector: Cellnex, the Barcelona-based company that ended up in the orbit of Edizione Holding as part of the agreement with Abertis, has written a check for 10 billion euros to take over the European towers of Hutchison, the Hong Kong giant. A historic deal, but one that probably doesn't satiate the appetites of the group chaired by Franco Bernabé who bought the French Iliad network in the last five years, challenging the competition from American Towers.
both in Asia and in the USA, the sector is 90% in the hands of Tower specialists, while in Europe the percentage does not exceed 60%. The reason? In part it is linked to geography (much more contrasted than the American plains), in part to the history of telecommunications itself. The towers were needed to help the development of individual operators, forced to deal with the competition present in the various territories. In Europe, on the contrary, the culture of the sector has been made by engineers chasing technical solutions in a regime of public monopoly, less sensitive to the needs of finance. Up until more recent times, when lower profitability forced telecoms to focus on condominium networks following the path indicated by Patrick Drahi, the acrobatic owner of Altice, the first to sell minority stakes in France and Portugal.
In short, the game of towers has more players. On the one hand, the specialists at Cellnex, ready to replicate the American model (Asia doesn't count because the towers there are 100% in the hands of the managers). On the other, Europe, where Stéphane Richard of Orange has launched the idea of a super tower company between Vodafone, Deutsche Telekom and Orange itself, in which to bring together the various companies with the aim of making cash by selling minority shares without but lose a precious one cash cow. On the model of our Inwit, a condominium between two former enemies (Vodafone and Tim) forced to get along for cash reasons. Indeed 5G. In fact, everyone seems to agree on one point: no one can afford to go it alone in the face of the need to lower costs and increase quality, as required by the technological challenge in an environment that remains very competitive.
