Globe closes P9.5-billion sale of towers to Frontier Tower Associates

Ayala-led Globe Telecom Inc. on Monday said it closed the sale of 750 towers to Frontier Tower Associates Philippines Inc. for P9.5 billion, with proceeds to be used for its debt servicing requirements in 2023.

In a regulatory filing to the local bourse, Globe said the latest closing transfers 1,550 out of the 3,529 towers to Frontier Towers, 81% of which are ground based, and 19% are rooftop.

With the sale, Globe has already transferred the ownership of 2,251 out of its 7,059 towers for P28 billion, following the first closing in September when it transferred 800 towers to Frontier Towers and 701 towers to MIESCOR Infrastructure Development Corp. (MIDC).

Globe in August inked two sale deals involving over 5,000 towers for P71 billion,  in which the company will then lease them back for an initial 15-year period.

“We are happy that we have successfully completed 32% of this record-breaking initiative giving us much leeway to cover for our 2023 debt servicing requirements amidst the backdrop of rising interest rates,” Globe chief finance officer Rizza Maniego-Eala said.

“This tower deal will also help us meet the changing consumer demand while ensuring that our network expansion is done in a sustainable and responsible way,” she added.

The company in 2018 said it is looking at divesting its tower assets to independent tower companies, as part of its network expansion and optimization plan.

“We believe that our strategic partnership with the tower companies is critical in this very competitive market and in providing the best internet connectivity in the Philippines that is comparable to the rest of the world,” president and chief executive officer Ernest Cu said.

Just last week Globe said it is set to spend $1.3 billion in 2023, 30% lower than the expected $1.9 billion in capital expenditures for this year, as it focuses on capital efficiency and optimization.

Shares in Globe were trading up by P4.00 or 0.19% at P2,164.00 apiece as of 10:50 a.m. on Monday.—AOL, GMA Integrated News