Phoenix Tower International today announced an agreement with EI Towers to acquire its TowerTel subsidiary, which owns or leases 2.4k towers and distributed antenna systems (DAS) across Italy, for €500m ($609m). In addition, TowerTel has exclusive telecommunications marketing and leasing rights to more than 1.6k broadcast sites owned by EI Towers. Indeed, this brings the total TowerTel portfolio to more than 4.0k sites in the country.

As part of the agreement F2i, an Italian infrastructure fund, and EI Towers’ majority shareholder, will retain a 20% minority ownership stake in TowerTel. Indeed, prior to the sale of TowerTel to Phoenix Tower, F2i owned 60% of TowerTel. Additionally, Italy’s largest commercial broadcaster, Mediaset, owned the remaining 40% of TowerTel. Notably, F2i has €5bn of assets under management.

Phoenix Tower’s Entry into Italy Through TowerTel

Phoenix Tower is entering the Italian tower market with an intention to increase the revenue of the TowerTel portfolio. As an example, Phoenix Tower plans to develop new towers across Italy. Furthermore, the company foresees demand from small cell deployments, further 4G and 5G build-outs, significant fixed wireless access (FWA), and fiber roll-outs across the country.

Phoenix Tower’s financial advisor was Natixis, and its legal advisor was Freshfields Bruckhaus Deringer. EI Towers’ financial advisor was Nomura and its legal advisor was Chiomenti Studio Legale.

Italy Tower Operators

Overall, Italy has 45k towers, giving Phoenix Tower, with TowerTel, a market share of ~5% of the total towers across the country. The largest owners of towers in Italy include INWIT (22.1k towers), Cellnex Telecom (10.8k towers), and Wind Tre / CK Hutchison (8.1k towers).

Phoenix Tower Overview

Phoenix Tower International owns and operates over 12.5k towers and 610 route miles of fiber. Specifically, this portfolio spans across 16 countries in the United States, Europe, and Latin America. Indeed, Phoenix Tower was founded in 2013 with a mission to be a premier site provider to wireless operators across high-growth international markets. Phoenix Tower’s investors include Blackstone, John Hancock, and various members of the management team.

Most recently, in late November 2020, Phoenix Tower agreed to sell 2.5k tower sites in Brazil to Colony Capital-backed Highline do Brasil.

Phoenix Tower Expansion in Europe, Beyond Italy

In 2020, Phoenix Tower has been aggressive in building out its presence across Europe. Italy is the third market in which Phoenix Tower is active in, following its purchase of TowerTel from EI Towers. Additionally, the company made inroads into both France and Ireland, earlier in the year.

In March 2020, Phoenix Tower closed an agreement with Bouygues Telecom to develop 4.0k towers, over 12 years, across France. Additionally, in May 2020, Phoenix Tower acquired 650 towers in Ireland from carrier Eir (owned by Iliad) for €300m ($330m). The Eir transaction valued the tower portfolio at an Enterprise Value per tower of €462k per tower. Additionally, this transaction represented a multiple of 28x EBITDA on the portfolio.

Adam Simmons is the Founder & CEO of Dgtl Infra. He started his career with an S&P 500-listed big box retailer, in an operations management role. Adam's entrepreneurial "itch" led him to start a 5G-driven company, focused on innovative retail solutions using augmented reality and shoppable videos, which was eventually sold to an advertising and consulting group. After, realizing the potential of 5G, Adam shifted his efforts towards investing in the "building blocks" of 5G - known as digital infrastructure, completing a number of strategic investments, buying cellular towers, data centers and fiber networks.

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