Virgin Media O2, Liberty Global’s UK operating company, has today reached an agreement to sell a 16.67% minority stake in its mobile tower joint venture, Cornerstone Telecommunications Infrastructure Limited to the UK-based infrastructure fund, GLIL Infrastructure LLP.
Cornerstone is the UK’s largest mobile towers business, consisting of a nationwide network used by both Virgin Media O2 and Vodafone UK as anchor tenants. It has the highest density of network in the UK, owning and managing an estate of around 20,000 sites spread across both urban and rural locations.
Virgin Media O2 will receive approximately £360 million payable in cash at closing of the transaction and will retain a 33.33% stake in Cornerstone upon completion of the transaction.
Cornerstone will remain a critical supplier to Virgin Media O2, and this transaction will not impact the existing commercial network sharing agreement between Vodafone UK and Virgin Media O2, known as Project Beacon, which sees the two companies share radio equipment across certain areas of the country.
The transaction is expected to close in the coming weeks.
Lutz Schüler, CEO of Virgin Media O2, said: “Selling a minority stake in Cornerstone is a logical move for us. We are partially monetising our tower infrastructure, while retaining operational and strategic co-control in a key asset as we roll out 5G to more of the country and boost 4G connectivity. This deal aligns perfectly with our core infrastructure and capital allocation strategy which sees Virgin Media O2 continue to invest in the UK to expand and upgrade our next generation fixed and mobile footprints. As a trusted UK centric investor, GLIL is the best long-term partner for Virgin Media O2 at Cornerstone.”
Simon Davy, an Investment Director at GLIL, said: “GLIL is delighted to be partnering with Virgin Media O2, providing local capital to support the delivery of critical mobile infrastructure. We are attracted by Cornerstone’s position as the owner of the UK’s largest tower portfolio, which fits well within GLIL’s existing portfolio of high quality, core infrastructure assets.”