Telefonica hailed progress in sweeping restructure plans to improve financial stability, with a deal between its German unit and infrastructure subsidiary Telxius expected to cut the group’s net debt by €500 million.
In a statement, Telefonica said the savings will be recorded over 2020 and 2021, and pledged to will continue “advancing” on its infrastructure strategy.
Sale of infrastructure assets in Germany was part of group plans unveiled in 2019 to raise funds by selling and leasing back towers. It sold 6,000 towers in 2019, half of which went to Telxius.
In its latest deal, Telxius will acquire and lease back 10,100 Telefonica Deutschland sites for €1.5 billion, and commit to build 2,400 additional towers over the next four years.
Telefonica said if the deal is approved by regulators, it will help ensure “exceptional future growth in Europe’s largest market”. It will also double Telxius’ tower portfolio to more than 32,800 sites across six countries.
The agreement ends speculation over a tower sale by Telefonica Deutschland rumoured earlier this year: on an earnings call with German media in May, the unit’s CEO Markus Haas said it received a high level of interest in the assets, with Telxius previously tipped as the buyer.
Telefonica holds a 50.01 per cent stake in Telxius, with the remainder held by investment companies KKR (40 per cent) and Pontegadea (9.99 per cent).Subscribe to our daily newsletter Back