MegaFon and Vertical to establish independent towerco

MegaFon and Vertical to establish independent towerco

Russia’s MegaFon is spinning off its tower infrastructure into a new independent joint venture with the domestic tower firm Vertical.

ComNews reports that MegaFon will take a 25% stake in the venture, while Vertical’s controlling shareholder Kismet Capital will take a majority stake of over 65%. MegaFon will transfer ownership of around 17,000 towers as well as facilities from its subsidiary First Tower Company - which it established in 2017 – while Vertical will contribute over 5000 towers.

In a statement, MegaFon confirmed that the new venture would retain full independence, saying “the structure of the combined company assumes that neither MegaFon nor any other telecom operator will be able to gain control of the company or a majority in the board of directors.”

The deal is set to close by the end of 2021.

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