Mobile Telecommunications Infrastructure for Sale
Wave of mergers and acquisitions to avoid duplication and generate synergies and efficiencies.
Major mobile telecommunications companies around the world are selling their mobile infrastructure assets, particularly mobile towers. This trend began several years ago in countries such as Italy with Telecom Italia and in the United States with América Móvil.
One of the main reasons behind this strategy is the significant investment required for the deployment of 5G technology. In Spain alone, telecom operators are expected to invest more than 5 billion euros to roll out this new mobile technology, which will significantly increase connection speeds, reduce latency and dramatically expand the number of connected devices.
Industry analysts, investment funds and financial institutions such as Barclays have pointed out that traditional mobile towers will not be sufficient to support the growing connectivity needs.
The deployment of 5G will require a much denser infrastructure network, including additional antennas and fiber optic networks connecting multiple sites. This substantially increases operational costs.
For this reason, many telecom operators are establishing agreements to share network infrastructure and reduce expenses. In Spain, examples include agreements between Vodafone and Orange, as well as between Orange and MásMóvil.
However, these measures are often not enough, and companies also need to generate liquidity. Telefónica, for example, has put around 50,000 infrastructure sites up for sale. In November 2019 it sold 2,000 antennas in Brazil to its subsidiary Telxius for approximately 140 million euros. Earlier in April 2019, it also sold its microwave radio link business to the Spanish investment fund Asterion Industrial Partners.
Other similar initiatives include Vodafone, which created Vantage Towers to manage its infrastructure globally and is seeking to divest around 62,000 towers, and MásMóvil, which announced an agreement to sell 940,000 FTTH fiber access points to the infrastructure fund Macquarie. Together with other investors, Macquarie created the company Onivia to manage and commercialize these assets.
This new landscape requires the companies managing these infrastructures to acquire qualified personnel and advanced management systems capable of operating and automating complex processes.
As a result, software companies such as TEAMnet are continuing to invest in the development of new sector-specific solutions that improve efficiency in the management and operation of telecommunications infrastructures.
