Investment firm Kismet Capital Group, through its joint venture with telecoms company Megafon, can apparently now boast the largest tower asset portfolio in Russia after a major acquisition involving a Russian infrastructure company.
Kismet says it has acquired 100 percent of Russian Towers, the largest Russian independent owner and operator of towers and poles used, in the main, for mobile telecommunications. As a result of the deal, the number of tower sites operated by the Kismet-Megafon joint venture will exceed 30,000, of which 7,000 come from Russian Towers.
The cost of the deal is not being disclosed. According to the statement from Kismet, the deal is being financed via Kismet's own funds and a loan from Sberbank.
Russian Towers will now become part of a company called New Towers, which already holds assets from tower company Vertical and Megafon’s First Tower Company. Following the incorporation of Russian Towers, Kismet Capital Group will hold a 65 percent shareholding in New Towers, with Megafon taking a 25 percent stake and Vertical the remainder.
More activity in the Russian tower market is expected, especially as tower portfolio sales – or spinoffs – are becoming a popular way for telcos to raise cash or create future income streams.
As Reuters points out, Russian operators MTS and Rostelecom are likely to follow the example of Veon, whose primary market is Russia, and which last month closed the sale of its Russian mobile towers to local firm Service-Telecom, a partner of VimpelCom’s Beeline, for about $957 million.