Tim and Vodafone sent out teasers for selling a 25% stake in Inwit, after the merger with Vodafone Towers

Teasers have been sent to investors potentially interested in buying a 25% stake in Inwit (Infrastrutture Wireless Italiane) spa, the Milan-listed company that owns Tim‘s mobile phone towers, which will incorporate and merge with Vodafone Towers srl, the company that owns the mobile phone towers of Vodafone, once obtained the go-ahead from the European Antitrust (see the press release here). Il Sole 24 Ore writes, specifying that, if the Antiturst’s ok arrives smoothly, Tim and Vodafone could examine the offers in March already, while otherwise the sale could slip to after the Summer.
The agreement signed last July between Tim and Vodafone states that Vodafone will receive 2.14 billion euros and 360 millions Inwit shares in exchange for its stake in Vodafone Towers, so that Tim and Vodafone will hold the same number of shares, equal to 37.5% each of the share capital of the new Inwit merged group (see the press release here). And then, as announced by  Tim’s ceo, Luigi Gubitosi, in an interview with Il Sole 24 Ore last November, “after the merger, Tim and Vodafone will control 75 percent of Inwit and we intend to reduce it to 50.1 per cent . So if anyone wants to join us on the right conditions, they are welcome”.
At work on the sale of the 25% stake of Inwit are the same advisors who worked on the merger of Vodafone Towers in Inwit on behalf of Tim and Vodafone, namely Banca Imi, Bank of America-Merrill Lynch, Goldman Sachs and Ubs (see Reuters here) .
Inwit will consolidate the current 11 thousand Vodafone towers and the merger will create a group with 22 thousand towers for mobile telephony and a capitalization of around 10 billion euros. Last December, Inwit signed a 3 billion euro loan agreement with a pool of banks. The loan, divided into three credit lines, bridge, term and revolving, is intended precisely for the acquisition by Inwit of the 43.3% stake in Vodafone Towers and for the distribution of the extraordinary dividend of 570 million euros, envisaged in the the scope of the deal, as well as to refinance part of Inwit’s existing debt and finance the company’s cash needs.
Inwit was born in 2015 following the transfer of Tim’s business unit relating to the construction and management of telephony infrastructures such as towers, pylons and poles and the technological systems necessary to host the transceiver equipment. Inwit ended FY 2018 with revenues of 374.6 million euros, a recurring ebitda of 211 millions and a net financial debt of 48.3 million euros. The first nine months of 2019 closed with revenues of 287 millions, a recurring ebitda of 165 millions and a net financial debt of 730 millions (considering the impact of the new accounting standard IFRS 16; net of it, is 73 million, see the analysts’ presentation here).
The dossier is obviously on the desk of the major international infrastructure funds, such as Ardian Infrastructures, as well as the Italian infrastructure fund F2i, but it is said also to be of interest for classic big private equity firms, pension funds and sovereign funds. Among the latter, however, it is difficult to imagine Adia from Abu Dhabi and Gic from Singapore, given that they control 45% of Cellnex, Inwit’s Iberian competitor also present on the Italian market (see here MF Milano Finanza). Precisely following the acquisitions in Italy in 2014 and 2015 of the portfolio of the telecommunications towers of Towerco (Autostrade) and Galata (Wind Telecomunicazioni), Cellnex Telecom has become the leading independent operator in Europe in the telecommunications infrastructure sector, with a total portfolio of more than 50 thousand towers.