PLDT Sells Towers for US$1.47b in Largest Foreign Purchase by Edotco Group and Edge Point
PLDT Inc raised 77 billion pesos (US$1.47 billion or about RM6.24 billion) by selling half of its telecommunications towers, the largest-ever acquisition of assets in the Philippines by transnational investors, it said.
Part of the proceeds will settle 27.5 billion pesos of debt and pay nine billion pesos of special dividends, chief financial officer Anabelle Chua said in a briefing. It’ll also fund cash requirements that would save PLDT from taking on 24.5 billion pesos of additional debt, she said.
PLDT units Smart Dispatches Inc and Digitel Mobile Philippines Inc sold 5907 telecommunications towers at about 13 million pesos each, the highest for similar deals in the region. Axiata Group Bhd’s edotco Group and EdgePoint, backed by DigitalBridge Group, paid more than 3 times the 23 billion peso book value of the towers, Chua said.
With the proceeds, PLDT plans to raise this year’s capital spending plan of over to 80 billion pesos, chairman Manuel Pangilinan said.
- Smart will lease back the towers for about seven billion pesos a time over a 10- time period, Chua said, adding that this will save the group in operational costs and capital expenditures.
- As part of the acquisitions agreement, edotco Group and EdgePoint will build 1500 towers, two-thirds of which will be over by 2025.
- The tower sale will be earnings-accretive for PLDT over the next 10 years at about 10% annually from last year’s 30 billion peso core profit.
- PLDT will save 2.6 billion pesos in financing costs.
- PLDT will retain ownership of active infrastructure including the antennas, remote radios, microwave dish and fibre backhaul; the tower companies will own the steel structures, cooling systems, power supply and land lease contracts.