American Tower today announced that Caisse de dépôt et placement du Québec (CDPQ), a Canadian pension fund, will acquire a 30% stake in ATC Europe, a joint venture that consists of American Tower’s operations in France, Germany, and Poland. Moreover, the ATC Europe joint venture with CDPQ will increase in size once American Tower closes the European (Germany and Spain) portion of its €7.7bn ($9.4bn) acquisition of Telxius’ towers from Telefónica.

In terms of valuation, CDPQ is acquiring its 30% stake in ATC Europe for €1.6bn+, implying an enterprise value for 100% of the entity at over €8.8bn. In turn, this equates to a valuation of 24.5x EBITDA for ATC Europe.

Prior to CDPQ’s acquisition of a 30% stake in ATC Europe, the joint venture was owned 51% by American Tower and 49% by PGGM, a Dutch pension fund. Finally, the transaction with CDPQ is expected to close in Q3 2021.

American Tower – Europe Operations

American Tower currently owns 5.3k tower sites across Europe, within France (3.1k sites), Germany (2.2k sites), and Poland (27 sites). However, pro forma for the closing of American Tower’s pending Telxius acquisition, Europe will scale to nearly 30.0k communications sites. Additionally, pro forma for Telxius, American Tower will generate ~$800m of property revenue and ~$460m of gross margin in Europe.

Transaction Rationale

American Tower is using the CDPQ minority stake sale as a source of funding for its pending Telxius acquisition. Additionally, the company gains another long-term partner through which future expansion opportunities in Europe can be evaluated and financed.


American Tower will retain control of the management, operations, and day-to-day oversight of ATC Europe. While CDPQ will obtain board of directors seats for American Tower’s ATC Europe subsidiary, along with certain governance rights.

Transaction Advisors – American Tower and CDPQ

American Tower’s financial advisors were Bank of America and CDX Advisors. Additionally, CDPQ’s financial advisor was HSBC.

Funding the Telxius Acquisition

Beyond today’s announcement with CDPQ, American Tower also provided clarity on the additional equity it requires to fund its €7.7bn ($9.4bn) acquisition of Telxius’ 31.0k European and Latin American towers from Telefónica.

Overall, American Tower will offer 8.5 million shares of its common stock. Also, the company will grant its underwriters an over-allotment option for an additional 850k shares of common stock.

Therefore, assuming American Towers sells the full 9.35 million shares at its closing price of $248.88 on May 4, 2021, the equity raise will secure gross proceeds of $2.3bn. However, net proceeds to American Tower from this offering will be lower, once factoring in underwriting discounts, commissions, and fees.

Use of Proceeds

American Tower will use the net proceeds from this equity offering to finance a portion of the Telxius transaction. In addition, the company will use cash on hand and borrowings under its revolving credit facilities and term loans, to finance the remainder of the Telxius transaction.

Book-Running Managers

Bank of America is acting as lead book-running manager for American Tower’s equity offering. Additionally, Barclays, Citigroup, Morgan Stanley, and RBC are the joint book-running managers.

Adam Simmons covers Towers for Dgtl Infra, including American Tower (NYSE: AMT), Crown Castle (NYSE: CCI), SBA Communications (NASDAQ: SBAC), Cellnex Telecom (BME: CLNX), Vantage Towers (ETR: VTWR), IHS Holding (NYSE: IHS), and many more. Within Towers, Adam focuses on the sub-sectors of ground-based cell towers, rooftop sites, broadcast / radio towers, and 5G. Adam has over 7 years of experience in research and writing for Towers.


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