Cellnex Buys CK Hutchison’s European Tower Business And Approaches The World Leader American Power

Cellnex HutchinsonThe company has entered five new countries (Austria, Denmark, Poland, Portugal and Sweden) during 2020

In Europe, corporate activity is showing signs of recovery. Last week Cellnex announced it will buy Hutchinson towers in Europe (24.600 sites in six countries) for 10 billion euros. The operation will be paid partly in shares so that Hutchinson will acquire 5% of the Spanish group. At the press conference organized by the company, the top management indicated they expect EBITDA to increase from 640 million euros in 2022 to 970 million euros in 2030. They also expect increases in operating leases, from 200 million euros in 2022 to 230 million euros in 2030.

The portfolio acquired by Cellnex consists mainly of macro sites (60% versus 40% in terraces), which is in line with previous purchases. The Spanish firm flagged that, despite the fact new geographical regions are coming on board (Austria, Denmark and Sweden) with the same main leaseholder, historically, whenever they have accessed a new area, they have expanded via acquisitions.

Another important point is that, like past purchases, the acquisition is linked to a “consolidation clause.” This comes into effect if the main tenant consolidates with another telecommunications company, which protects them and also gives them the possibility of expanding their business.

Since its IPO five years ago, Cellnex has invested more than 25 billion euros in purchases. When this agreement is closed and developed, in a year and a half, it will have 103,000 sites and will consolidate its position as European leader among telecommunications infrastructure operators, with a presence in 12 countries, thus closer to the world leader American Tower.

On the other hand, the Swedish fund EQT, controlled by the Wallenberg family, is exploring a takeover bid for Dutch operator KPN that could exceed 11 billion euros.

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The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.