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Virgin Media O2 Close to Selling UK Masts Stake to GLIL Infrastructure

Tuesday, Oct 31st, 2023 (8:41 am) - Score 4,712

Virgin Media and O2 have reportedly entered “exclusive talks” that could see them selling off a big stake in the UK’s largest mobile tower network to GLIL Infrastructure. The deal is said to value this part of their business at around £2.5bn, with any proceeds helping to fund their full fibre (FTTP) broadband and 5G mobile roll out.

At present the parents of Virgin Media (Liberty Global) and O2 (Telefonica) hold a 50% stake in mast operator Cornerstone, which forms part of a network sharing agreement with rival Vodafone (Vantage Towers). But in April 2023 it was reported (here) that VMO2 had begun a process that could sell “at least” half of their stake in this business (at the time this was said to be worth c.£750m), with Goldman Sachs and JPMorgan being appointed to oversee the process.

NOTE: Cornerstone manages a UK estate of c. 20,000 sites (masts, rooftops, small cells etc.).

In recent years’ it’s become increasingly common to see mobile operators selling off tower assets, or stakes in those same assets, to help fund infrastructure and service upgrades elsewhere. In the case of VMO2, the operator has a number of expensive projects to both deploy 5G mobile, and upgrade their old Hybrid Fibre Coax (HFC) based fixed broadband network to 10Gbps capable FTTP (XGS-PON) by 2028 (Project Mustang).

On top of that, VMO2’s parents have created a new joint venture called nexfibre (here) – backed by £4.5bn – that aims to deploy an open access full fibre network to reach “up to” 7 million UK homes in areas NOT currently served by Virgin Media’s own network – starting with 5 million by 2026. Virgin Media is currently the only ISP on this network (here).

Alternatively, VMO2 / nexfibre could use the extra funds to help support a potential takeover of more alternative full fibre networks, much as they recently did with Upp (here). Clearly, VMO2’s parents are considering a lot of different approaches for the future right now, and selling a stake in their tower estate is a natural part of that process.

At present it’s not known how much of a stake GLIL, a partnership of British pension funds, will actually look to secure (it’s likely to be around 25% or 50%). But Reuters suggests we may well find out soon, as VMO2 are due to release their next batch of financial results tomorrow, although that may well occur before a deal can be formally announced.

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By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook and .
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4 Responses
  1. Avatar photo I’ll sell what I have and rent it back forevermore… says:

    Short-termist folly, something this country is apparently addicted to… little wonder pension funds, particularly Canadian ones own so much of the UK’s infrastructure.

    1. Avatar photo Madness says:

      Councils up and down the country are doing the same thing with council assets/ stock. Most of them are bankrupt.

    2. Avatar photo Buggerlugz says:

      Don’t worry, they’re pensions will be awesome. Nothing else will be though.

  2. Avatar photo CHB says:

    My understanding from internal discussions is this cash will be used to boost 4G and 5G coverage including more small cells, buying future spectrum + rolling out more spectrum across the country + unwinding from Vodafone/Three in more places.

Comments are closed

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