Cellnex buys the Irish operator Cignal

It is one of Ireland's leading telecommunications infrastructure operators, operating 546 sites and planning to deploy up to another 600 over the next 7 years. The agreement values ​​the company at 210 million euros.

Cellnex has reached an agreement with InfraVia Capital Partners for the acquisition of the Irish telecommunications tower and site operator Signal for an enterprise value of 210 million euros.

Signal currently operates 546 sites in Ireland, which becomes the seventh country in which Cellnex carries out its activity in Europe. The Irish company manages an attractive portfolio of locations with a current customer ratio per location (customer ratio) of approximately 2x, as well as limited overlap with third-party locations, which increases its attractiveness for operators. Cignal has significantly expanded its asset portfolio since its inception in 2015, following the initial acquisition of 300 telecommunications towers.

Cignal's contracts with clients have an average duration of 20 years. The company also plans to deploy up to 600 new sites in the next 7 years (2026), with an additional investment of approximately 60 million euros.

When all these new locations are deployed, it is estimated that an additional EBITDA of around 20 million euros will be generated for the Group. The acquisition and future investments will be funded with the group's available cash and the future cash flows of Cellnex Ireland.

Ireland currently has a fleet of 4,500 telecommunications sites, of which approximately 60% are controlled by mobile operators (Vodafone, 3 and Eir) and 40% are managed by different telecommunications tower operators, up to a total of eight, including Cignal.

Tobías Martínez, CEO of Cellnex, pointed out when announcing the agreement that "with Cignal we not only integrate one of the main independent telecommunications infrastructure operators in Ireland with a professional and experienced management team. We are also committed to coherent growth in Europe, incorporating a seventh market - which naturally extends the current geographical area of the six countries in which we already operate -, and in which we are going to work with clients to whom we already offer services in other countries, thus strengthening our relationship of long-term collaboration.

Fifth inorganic growth operation in 2019

In the first nine months of 2019 Cellnex has reached different growth agreements that will lead it to expand, once closed, by nearly 16,000 asset portfolio in European countries in which the company is present.

In May the company announced a European-wide agreement with Iliad (in France and Italy) and with Salt in Switzerland, which will mean increasing the current portfolio by 10,700 locations (5,700 in France, 2,200 in Italy and 2,800 in Switzerland), with an investment for Cellnex of 2.7 billion euros. To these agreements, which are expected to close in the second half of 2019, are added the deployment until 2027 of 4,000 new sites (2,500 in France and 1,000 in Italy for Iliad, and 500 for Salt in Switzerland) with a global investment expected to reach 1,350 million.

In June, Cellnex and BT announced the signing of a long-term strategic collaboration agreement through which Cellnex acquired the exploitation and marketing rights of 220 high-rise telecommunications towers in the United Kingdom. The agreement, worth £100 million (approximately €113 million), increases the sites that Cellnex will manage in the United Kingdom by almost 40%.

The combined investment of all these projects, including the acquisition of Cignal in Ireland, exceeds 4.3 billion euros. In terms of additional EBITDA, also once all deployments are completed, the estimated annual contribution would reach €530 million.