Vodafone partners with GIP, KKR for Vantage Towers


Strategic co-control partnership with long-term investors with significant expertise in digital infrastructure to accelerate Vantage Towers’ growth and value creation.

Creation of a JV with GIP and KKR, to hold Vodafone’s 81.7% stake in Vantage Towers which will be deconsolidated by Vodafone.

Attractive valuation of €32.0 per share, a premium of 19% to Vantage Towers’ 3 month volume-weighted average share price and a multiple of 26x adjusted EBITDAaL for the 12 month period ended 31 March 2022.

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JV to make a voluntary takeover offer for the outstanding Vantage Towers shares held by minority shareholders, funded through new debt in the JV and equity from GIP and KKR.

Minimum net cash proceeds to Vodafone of €3.2 billion, based on equity from GIP and KKR that is fully committed at signing and maximum minority take up in the voluntary takeover offer, which would reduce Vodafone’s leverage by 0.2x.

Maximum net cash proceeds of €5.8-7.1 billion1, depending on the take up in the voluntary takeover offer and subject to GIP and KKR raising further equity before closing to increase their stake in the JV to 50%, reducing leverage by 0.4x-0.5x.

Transaction conditional on regulatory clearances and expected to close in the first half of 2023

Nick Read, Vodafone Group Chief Executive said: “This is a landmark moment for both Vodafone and Vantage Towers. This transaction successfully delivers on Vodafone’s stated aims of retaining co-control over a strategically important asset, deconsolidating Vantage Towers from our balance sheet to ensure we can optimise its capital structure and generate substantial upfront cash proceeds for the Group to support our priority of deleveraging. We are excited to partner with GIP and KKR, both world-class investors who bring significant expertise in digital infrastructure and share our long-term vision for Vantage Towers as we collectively take the business to the next stage of its growth.”

Will Brilliant, Partner and Head of Digital Infrastructure at GIP said: “We’re delighted to join forces with Vodafone and KKR to invest in Vantage Towers, a high-quality European tower portfolio with strong upside potential. We are looking forward to capturing the exciting value-creating opportunities in the European telecoms infrastructure sector by advancing Vantage Towers’ strategy and supporting its capacity to build new sites. As strategic partners with Vodafone and KKR, we will bring our deep infrastructure expertise and resources to help the company deliver the best data connectivity for individuals and businesses and contribute to enabling Europe’s digital future in the interest of all stakeholders.”

Vincent Policard, Partner and Co-Head of European Infrastructure at KKR said: “Together with our strategic partners Vodafone and GIP, we believe Vantage Towers’ high-quality footprint and network across the region ideally position it to meet the ever-growing demand for mobile connectivity in Europe. We have a shared goal of creating a pan-European telecoms champion by continuing to grow and develop the business, leveraging the Consortium’s significant telecoms infrastructure investment experience and global resources. At KKR we are long-term conviction investors in Europe’s digital infrastructure and at Vantage Towers we intend to pursue value-creating investments to capitalise on the growth in this sector and to help drive consolidation in a fragmented market.”

Vodafone Group has entered into a strategic co-control partnership with a consortium of long-term infrastructure investors led by Global Infrastructure Partners (“GIP”) and KKR (together the “Consortium”) for Vodafone’s 81.7% stake in Vantage Towers AG (“Vantage Towers”).

Vodafone and the Consortium have created a joint venture (the “JV”) which will hold Vodafone’s 81.7% stake in Vantage Towers. Vodafone will contribute its shares in Vantage Towers into the JV by way of a capital increase against new JV shares. The Consortium will obtain a shareholding in the JV of up to 50% by acquiring JV shares from Vodafone for cash.

In parallel with this announcement, the JV has announced today that it will make a voluntary takeover offer (“VTO”) for the outstanding Vantage Towers shares held by minority shareholders pursuant to Section 10 of the German Securities Acquisition and Takeover Act. Completion of the VTO will be conditional on customary conditions, including obtaining regulatory clearances for the partnership between Vodafone and the Consortium. The full terms and conditions of the VTO will be set out in a separate offer document to be approved by the German Federal Financial Supervisory Authority (BaFin). Following approval by BaFin, the offer document will be published and the acceptance period for the VTO will commence.

The JV has received support from RRJ Capital in the form of an irrevocable undertaking to accept the VTO. RRJ Capital is Vantage Towers’ second largest minority shareholder and owns 2.4% of its ordinary share capital in issue (or 13% of the total minorities).

Strategic co-control partnership

Vodafone and the Consortium share a joint ambition to accelerate growth and create further value at Vantage Towers. GIP and KKR both have extensive experience investing in and operating digital infrastructure companies. As long-term partners with an industrial mindset, Vodafone and the Consortium intend to enhance the business’ growth profile and profitability by supporting it in:

Delivering an ambitious build-to-suit programme which enables mobile network operators to meet their coverage obligations and densification requirements;
Capturing additional co-location opportunities from new and existing third-party customers;
Pursuing meaningful growth opportunities in adjacent areas such as small cells and distributed antenna systems for 5G capacity expansion, as well as edge computing;
Pursuing other growth-accretive investments, including actively participating in the consolidation of the European tower landscape; and
Enhancing profitability through continuous operational improvements.
As a result of the transaction, Vodafone will deconsolidate Vantage Towers and equity account for its interest in the JV which will allow Vantage Towers to optimise its capital structure and help drive its pursuit of the above growth opportunities.