Globe Telecom is selling a total of 5,709 towers for P71 billion and in advanced discussion for an additional 1,350 towers, the largest ever sale and leaseback transaction in the Philippines.
The Ayala-led telco it signed two sale and leaseback agreements for two portfolios consisting of 5,709 telecom towers and related passive telecom infrastructure for over P71 billion.
The company is also in advanced discussion with one other tower company for the potential sale and leaseback of an additional 1,350 towers.
The tower assets up for sale are made up of 79 percent ground-based towers and 21 percent rooftop towers, and have been grouped into three unique distinct portfolios assigned to three different tower companies representing local and international groups.
The first portfolio being sold consists of 2,180 telecom towers in Luzon, which will be acquired by MIESCOR Infrastructure Development Corporation (MIDC) for P26 billion, and leased back to Globe for an initial period of 15 years.
The first close for this portfolio is targeted to happen within the third quarter of the year.
The second portfolio consisting of 3,529 towers will be sold to Frontier Tower Associates Philippines Inc. for P45 billion, and also leased back over an initial period of 15 years.
The first closing target for this portfolio is targeted to happen in late third quarter of the year.
While the third portfolio, which consists of 1,350 towers is set to sign the sale and leaseback agreement with this tower company within the third quarter, with first closing happening within the fourth quarter of the year.
After the transaction, Globe’s remaining towers will be around 4,000 to 5,000.
Globe said the proceeds of the tower sale will be used to fund capital expenditures and to cover its 2023 debt servicing requirements.
“We have always been looking for ways to monetize our tower assets and this record-breaking initiative marks our continued commitment to optimize our capital raising efforts and further strengthen the balance sheet as we seek to capitalize on opportunities in the telecommunications sector and complementary services,” Rizza Maniego-Eala, Globe chief finance officer said.
Ernest Cu, Globe president and chief executive said these expanded long-term partnerships with the tower companies show its commitment to help improve the Philippines’s internet condition, as well as our desire to have as many Filipinos enjoy the benefits of having access to reliable internet.
“We also believe that through these monetization efforts, Globe will be able to further improve overall operational efficiency, allowing us to serve our customers better, and supporting our goal of enabling the digital lives of Filipinos,” he added.
MIDC Chairman Atty. Ray C. Espinosa said, “We are very pleased with this landmark deal with Globe that marks a critical milestone in MIDC’s strategy to enter the digital infrastructure space, which plays a vital role in driving economic growth and social wellbeing through digital inclusion.”
Patrick Tangney, chairman and chief executive of Frontier Towers, said, “We are honored by the trust Globe has shown Frontier in forming a long-term cellular tower strategic partnership. We look forward to continued collaboration with Globe and the country’s mobile network operators to advance the growth of digital infrastructure locally and to deliver stronger connectivity and sustainable, inclusive economic growth to the people of the Philippines.”