Globe expects that by selling the towers, it will spend less, especially on rent, than it did when it owned these towers.
The Ayala-led company announced on Friday that it signed two sale and leaseback agreements for 5,709 telecom towers and related passive telecom infrastructure for over P71 billion. “The first portfolio being sold consists of 2,180 telecom towers in Luzon, which will be acquired by MIESCOR Infrastructure Development Corp. for a total consideration of P26 billion, and leased back to Globe for an initial period of 15 years,” Globe said in a statement.Meanwhile, the second portfolio consisting of 3,529 towers will be sold to Frontier Tower Associates Philippines, Inc. for P45 billion, and also leased back over an initial period of 15 years. Pre-tax gain will be P15 billion.
Sought for comment, Philstocks Financial Senior Research Analyst Japhet Louis O. Tantiangco said Globe’s tower sale is seen as a good move. Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce said Globe’s capital raising is credit-positive as its balance sheet could improve to become more aligned with an investment-grade profile.
Source: News Formal (newsformal.com)