Tigo Colombia in deal to sell and lease back towers

Tigo Colombia in deal to sell and lease back towers

Millicom, a leading provider of fixed and mobile telecommunications services in Latin America, has announced that its subsidiary, the operator Tigo Colombia, has agreed to sell approximately 1100 wireless communications towers to affiliates of investment funds managed by KKR, a leading global investment firm.

KKR plans to work in partnership with NEXO LatAm, a digital infrastructure platform that supports the implementation of KKR's infrastructure strategy throughout Latin America.

As is increasingly the case in recent years, the sale has a lease component that allows the seller to go on using some of the towers without the expense of managing them.

Thus, as part of the transaction, Tigo Colombia and KKR have entered into a long-term agreement whereby KKR will lease wireless communications towers to Tigo Colombia to support its wireless networks, although how many has not yet been revealed.

The exact number of towers will be determined once the various closings have taken place, which are subject to customary closing conditions.

For Millicom this is clearly an important strategic decision. Mauricio Ramos, CEO and Chairman of the Board of Millicom, explains: “This transaction with KKR, a leading digital infrastructure franchise with deep sector expertise and commitment to the region, is another step towards crystallising the value of our tower sites across Latin America, simplifying our business, and allowing us to focus on servicing our customers.”

He continues: “This transaction enhances our operational and capital efficiency in Colombia, with long-term lease obligations denominated in Colombian pesos, consistent with our objective of increasing our proportion of financing in local currency.”