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Vodafone Group Plc ⫶ Vantage Towers

11 Jan 2021Technology news
2 minute read

Vodafone and Telefonica to commercialise UK’s largest tower company, Cornerstone

Vodafone to transfer its 50% shareholding in Cornerstone to Vantage Towers

Vodafone Group Plc's ("Vodafone") UK subsidiary, Vodafone Limited ("Vodafone UK") and Telefonica UK Limited ("TEF UK") (together, the "anchor tenants") today announce the commercialisation of Cornerstone Telecommunications Infrastructure Limited ("Cornerstone"), the 50:50 owned joint venture company that owns and manages their passive tower infrastructure in the United Kingdom.

Vodafone UK and TEF UK have each entered into long-term Master Services Agreements (each, an "MSA") with Cornerstone, which have initial terms of 8 years from 1 January 2021, with three 8-year renewal periods, and which establish Cornerstone as a preferred supplier of new sites for both operators.

Vodafone intends to transfer its 50% shareholding in Cornerstone to Vantage Towers in January 2021.

Key highlights

  • #1 tower infrastructure company in the UK operating c.14,200 macro sites and c.1,400 micro sites
  • Extends Vantage Towers' portfolio to c.82,0001 macro sites and its geographic presence in Europe to 10 markets, with leading positions in 9 of them
  • Adjusted FY20 pro forma adjusted EBITDA after Leases ("Adjusted EBITDAaL") of £111 million, thereby adding €62 million2 to Vantage Towers' pro forma aggregated Adjusted EBITDAaL based on its 50% shareholding in Cornerstone
  • Commitments for c.1,200 new macro sites by FY25 and c.1,950 new passive tenancies on existing sites by FY24, with an expected run-rate Adjusted EBITDAaL contribution of approximately £17.5 million by FY26 (100% basis)
  • Attractive medium-term revenue and recurring free cash flow ("RFCF") growth outlook, supported by new build macro sites, committed new passive tenancies and rural white spot coverage obligations
  • Cornerstone to maintain leverage of 3.0-4.0x Net Financial Debt / Adjusted EBITDAaL, by distributing 100% of excess cash with additional distributions from time to time to maintain leverage

Vivek Badrinath, Vantage Towers Chief Executive, commented: “Cornerstone is a great addition to the Vantage Towers portfolio. Cornerstone is exactly the type of high quality grid we like to own: a number one market position, and two strong anchor tenants with network sharing agreements in place for whom we are the preferred supplier. We look forward to working with our anchor tenants to power the UK's digital transformation, enabling the roll-out of 5G networks to benefit business and consumers and ensuring greater mobile coverage for all.”


  1. Incl. 100% of INWIT and Cornerstone
  2. Represents 50% of Cornerstone’s adjusted pro forma Adjusted EBITDAaL for FY20, please refer to p.6 for a reconciliation of adjusted to reported pro forma Adjusted EBITDAaL. In addition, please refer to the basis of preparation and definitions on p.5 and p.6. Based on average EUR / GBP exchange rate of 0.89402 over twelve months ended 31-Mar-20
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