PLDT raises P12.1 B from sale of towers
PLDT Inc. is raising P12.1 billion from the sale of more towers as it moves to build up its war chest by disposing of some of its assets.
PLDT’s mobile subsidiaries Smart Communications Inc. and Digitel Mobile Philippines Inc. are turning over 1,012 towers to Frontier Tower Associates Philippines Inc.
With the transaction, PLDT has monetized over 7,500 towers for a cash consideration of at least P98 billion since it started liquidating its assets through sale and leaseback agreements last year.
For this deal, Smart will lease the towers for a period of 10 years at competitive terms as the first tenant. In the process, the wireless giant plans to reach 550 new points of service in the next few years, allowing it to enhance its network and improve reliability.
On the other hand, Frontier gains an additional batch of towers that will be added to its portfolio in the Philippines. In particular, the tower operator will obtain telco assets located in Luzon from the sale and leaseback signed with PLDT.
As part of its expansion, Frontier bought a tranche of 3,529 towers, most of which are situated in Luzon as well from Ayala-led Globe Telecom Inc. for P45 billion in 2022.
Frontier serves as a unit of Singapore-based Pinnacle Towers Pte. Ltd., an infrastructure builder focused on putting up digital assets in Asia, including in the Philippines.
PLDT chairman Manuel V. Pangilinan said the transaction raises the financial viability of PLDT, boosting its finances that can be deployed for expansion projects.
“This transaction cements our relationship with one of the largest independent tower companies in the country. [It provides] the group with another important partner to support expansion, while unlocking additional value,” Pangilinan said.
The transaction will be closed on a staggered phase based on the number of towers being moved to Frontier’s ownership.
The goal, however, is to transfer all of the towers within the year.
UBS AG acted as the financial adviser to PLDT and Smart in negotiating the sale and leaseback with Frontier.
Last year, PLDT sold around 6,500 towers for roughly P86 billion to Comworks Infratech Corp., ISOC edotco Towers Inc. and Unity Digital Infrastructure Inc., as it wants to lighten its expenses to focus its spending on telco upgrades.