Singtel Sells $1.4 Billion Australia Towers Stake to AusSuper

(Bloomberg) -- Pension manager AustralianSuper Pty agreed to buy a majority stake in the mobile phone towers unit of Singapore Telecommunications Ltd.’s Australian subsidiary Optus for about A$1.9 billion ($1.4 billion).

The Singaporean telecom will sell a 70% stake in its Australia Tower Network, a wholly-owned subsidiary which operates Optus’s tower infrastructure, to the Australian fund,  the companies said in their statements. The deal values the unit, which has 2,312 mobile network towers and rooftop sites, at approximately A$2.3 billion including debt, Optus said in its statement.

“The rise of digital technology and its accelerated adoption on the back of Covid-19 has had major implications for the physical infrastructure that facilitate and support this overwhelming demand for data connectivity we are witnessing,” Yuen Kuan Moon, Singtel’s group chief executive officer, said in an announcement by Singtel.

“From our telecom towers to our data centres, it is imperative that we restructure our assets and re-organise our business to better fund, improve and grow our digital infrastructure,” he said. 

The funds beat out rival bidders including Canada’s Brookfield Asset Management Inc. and a partnership called Symphony Consortium comprised of OMERS Infrastructure Management Inc., Australian firm Stilmark Holdings Pty and U.S. telecommunications company ATN International Inc.

The deal mirrors another recent pension fund investment in mobile phone towers in Australia. In June, Telstra Corp., Optus’s main rival in the Australian market, raised A$2.8 billion selling 49% of its towers unit to Australia’s Future Fund, Commonwealth Superannuation Corp. and pension fund Sunsuper.

Both deals cap a string of sizable telecommunication towers deals globally as investors seek out exposure to real assets. Malaysia’s fourth-biggest phone operator U Mobile Sdn. is considering the sale of its telecommunication towers for about 500 million ringgit ($120 million), Bloomberg News reported this week. Spain’s Cellnex Telecom SA agreed in November to buy CK Hutchison Holdings Ltd.’s European telecommunication towers for about $12 billion, while American Tower inked a deal in January to buy a portfolio of towers in Europe and South America from a unit of Telefonica SA for about $9.4 billion.

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