Spain’s Cellnex interested in Deutsche Telekom towers to enter Germany

Spain’s Cellnex confirmed on Wednesday it is interested in buying Deutsche Telekom’s telecoms towers business as a way for the largest operator in Europe to enter Germany.

Cellnex does not plan to sell any of its holdings in Europe to fund a potential purchase of the Deutsche Telekom unit, Chief Executive Tobias Martinez told analysts, adding that Germany was “a very attractive market”.

“It’s public information that we are in the process,” Martinez said, adding he was not able to give further details.

Telecom towers have been the target of big takeovers in recent years and Cellnex is vying with U.S.-based American Tower Corp to expand in Europe ahead of the rollout of 5G.

April that Deutsche Telekom is reviewing proposals to sell a majority or minority stake in its towers business, with Cellnex only looking at a deal that would give it majority control.

Cellnex finance chief Jose Manuel Aisa also ruled out a new rights issue to pay for new operations after completing a 7 billion euro capital raising last year.

By 2030, Cellnex aims to control around 130,000 masts in the 12 European countries where it is currently present.

Cellnex earlier reported a first-quarter net loss of 93 million euros ($98 million), more than doubling from a year ago, while its core earnings grew 66%.

Its first-quarter adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose to 634 million euros, while total revenue grew 64% to 828 million euros, thanks to its expansion. Both figures were slightly below estimates.

Cellnex kept its 2022 outlook, with EBITDA to increase to between 2.65 billion and 2.7 billion euros this year, and revenue to reach between 3.46 billion and 3.51 billion euros.

Aisa said he was “very happy” with the results, attributing the wider loss to conservative accounting procedures and Cellnex’s expansion. It should turn a profit once its investment process ends, Aisa said, but that would not be soon. Reuters