Brookfield, investing through its Super Core-infrastructure fund, in-partnership with Alecta, a Swedish pension fund, today announced the acquisition of 49% of Telia Company’s 3.8k tower network sites in Sweden for €522m (SEK 5.5bn) in cash proceeds, implying an enterprise value for 100% of the business of €1.07bn (SEK 11.2bn). Notably, this agreement expands on Brookfield and Alecta’s prior transaction with Telia Company for a similar 49% stake in the company’s 4.7k towers in Finland and Norway.

As part of this transaction, Telia Company will enter into an anchor tenant agreement with Telia Towers in Sweden. Finally, the transaction is expected to close in Q3 2022.

Transaction Overview – Brookfield, Alecta Acquire Telia’s Towers in Sweden

Telia Company’s tower network sites in Sweden generate total pro forma revenue of €61.6m (SEK 649m) and normalized EBITDA of €37.8m (SEK 398m) in 2021.

Overall, Brookfield and Alecta’s valuation of Telia Company’s tower network sites in Sweden equates to an EV / normalized EBITDA multiple of 28.2x. Additionally, on an Enterprise Value per tower basis, the valuation equates to €280k per tower, on the 3.8k tower sites.

Use of Proceeds

Presently, Telia Company is operating at 2.14x net debt / adjusted EBITDA. Indeed, this is in the lower part of the company’s net debt / adjusted EBITDA target range of 2.0x to 2.5x.

As such, Telia Company intends to distribute the net proceeds from the sale of its towers in Sweden to shareholders. Particularly, the company could return this capital through share buybacks or an extraordinary dividend.

Telia Company, Brookfield, and Alecta – Nordic Towers

Telia Company’s 8.0k+ tower assets in Sweden, Finland, and Norway have been placed into the entity Telia Towers AB. Specifically, this company is 51%-owned by Telia Company, with the remaining 49% owned by Brookfield and Alecta.

Telia Towers AB Sweden Finland Norway

Collectively, Telia Towers AB’s 8.0k+ tower assets in Sweden, Finland, and Norway have recently been valued, by Brookfield and Alecta, at an enterprise value of €2.6bn.

Finland and Norway Towers

In December 2021, Brookfield, investing out of its core infrastructure fund, in-partnership with Alecta, acquired 49% of Telia Company’s 4.7k towers in Finland and Norway for €722m. This transaction implied an enterprise value for 100% of the business of €1.5bn.

Transaction Advisors – Telia Company

Telia Company’s financial advisor was Goldman Sachs. Additionally, Telia Company’s legal advisor was Roschier.

Brookfield Super Core-infrastructure Fund – Overview

Brookfield Asset Management’s perpetual managed capital currently stands at $100bn, which includes both listed entities and perpetual private funds.

In aggregate, Brookfield Asset Management has $7bn of capital under management from its various perpetual private funds. Within Brookfield’s perpetual private funds, the firm’s global Super Core-infrastructure fund is one product. Overall, Brookfield Super-Core Infrastructure Partners targets a cash investment yield of 5% and investment returns of 7% to 8% IRR.

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.

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