Telstra finalises $2.8 billion InfraCo Towers sale

Telstra announced it had completed the sale of a 49 per cent non-controlling stake in its towers business for $2.8 billion.

Announced on 30 June 2021 with a consortium comprising the Future Fund, Commonwealth Superannuation Corporation and Sunsuper, and managed by Morrison & Co, the transaction valued Telstra InfraCo Towers at $5.9 billion, representing an FY21 pro forma EV to EBITDA after leasing multiple of 28x. 

Telstra CEO Andrew Penn said realising more value from Telstra’s infrastructure assets was one of the fundamental pillars of Telstra’s T22 strategy, and this transaction was another marker of progress against that strategy.

“This transaction clearly recognises the strength and value of our InfraCo Towers assets, which contains some of the most strategic infrastructure in the country. I am pleased we have been able to complete the transaction together with our new partners,” said Mr Penn.

In line with the transaction’s completion and the launch of this new business, the Telstra InfraCo Towers entity will now be known as Amplitel Pty Ltd.

Mr Penn said Amplitel was the largest mobile tower infrastructure provider in Australia, with an asset portfolio of over 8,000 physical towers, mast, large pole and antenna mount structures.

“Amplitel’s world-class infrastructure will cater to mobile carriers, government, and public and private organisations across vast areas of the Australian landscape,” said Mr Penn.

“While Amplitel is a new organisation, its foundations are more than 100 years old. It’s a legacy we’re immensely proud of – but we’ll also be pushing forward to create our own unique offerings, creating a more connected Australia now and for the future from the ground up”

Telstra will retain 51 per cent ownership of Amplitel and continue to own the active parts of its network, including the radio access network and spectrum assets, to ensure it continued to maintain its industry leading mobile coverage and network superiority.

At its Full Year Results last month, Telstra announced it intends to return approximately 50 per cent, or up to $1.35 billion, of net proceeds from the transaction to shareholders during FY22 via an on-market share buy-back.

The remainder of the net proceeds from the transaction will be used for debt reduction to ensure Telstra maintains balance sheet strength and flexibility.