36.14 F
New York City
January 28, 2020
Home » Blog » France’s Orange plans to set up European mobile mast company
Reuters - Business

France’s Orange plans to set up European mobile mast company

France's Orange plans to set up European mobile mast company
Spread the Love!!

PARIS (Reuters) – Orange (ORAN.PA) said it planned to carve out its mobile towers in most European countries where it is present, in a move aimed at shoring up the telecom group’s value as tough competition in the region has hampered its growth and margins.

FILE PHOTO: Orange logo is seen during the Mobile World Congress in Barcelona, Spain February 28, 2018. REUTERS/Yves Herman

The French telecoms operator is following similar moves by other European companies that are looking at selling mobile networks as in valuations for infrastructure assets sky-rocket amid growing appetite from investors, such as U.S. private equity firm KKR (KKR.N) and Spain’s Cellnex (CLNX.MC).

Bigger rivals Deutsche Telekom (DTEGn.DE) and Britain’s Vodafone (VOD.L) have separated their mast mobile assets and are seeking to sell part of them via a listing or a private sale. Shares in Vodafone, the world’s second-largest mobile operator, rose as much as 10% when it announced plans to spin off its mobile masts.

“Today, we believe that the value of our all of our networks isn’t reflected in our stock prices,” Orange Chief Executive Stephane Richard said.

Orange’s mobile towers could be worth around 10 billion euros ($11 billion), analysts have estimated, while Citi said their value may reach 13 billion euros, or 20 times the operating results generated by towers.

France’s former telecoms monopoly said that it owned about 40,000 towers of its mobile network on the continent. The first “TowerCos” will be created in France and Spain, the company’s two biggest markets, in 2020.

The Paris-based company will retain control over all these new entities and is hoping to eventually merge them into a European company. This entity will also be majority-owned by Orange.

The group also said it was selling 1,500 mobile masts to Spain’s Cellnex for 260 million euros.

The divestments were part of Orange’s five-year strategic plan, in which it said it would share the deployment of high-speed fiber broadband technology with other operators through dedicated companies that could be opened up to outside investors.

Orange shares fell 3.8% in early trade, with some traders citing disappointment over the company’s dividend outlook. It said it will pay out a minimum annual dividend of 70 cents per share over the period.

Reporting by Mathieu Rosemain; Editing by Sudip Kar-Gupta and Louise Heavens

Source – For more click here

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Click whichever is suitable. Accept Read More