December 4, 2023

Virgin Mobile o2 sells shares in broadcast tower company

In Great Britain, local company o2 teamed up with multimedia group Virgin Media some time ago and has been operating ever since Virgin Media o2 (VMo2 for short). The reasons for the merger were cost considerations, as network operating costs were to be reduced. Another source of money is the sale of “private” transmission towers.

16.67 percent sold

Vo2LT is Virgin Media’s new o2 brand in the UK
Screenshot: Virginmedia o2 /

Virgin Media o2 now wants a 16.67 percent stake British mobile phone tower operator Cornerstone to GLIL Infrastructure Fund Sold for £360 million (€412 million) in cash. This would value Cornerstone at £2.16 billion (€2.48 billion). That reports it News magazine

Speculation trading

Speculations already appeared a few days ago: VMO2 began selling a stake in the tower company in April this year. Following the sale, VMO2 will still own a 33.33 per cent stake in telecommunications tower company Cornerstone, which has around 20,000 sites across the UK. The company founded by Vodafone is also present Al Fadl TowersWhich will own the remaining 50 percent.

Talib Lutz: A logical step

“Selling a minority stake in Cornerstone is a logical step for us,” explained Lutz Student, who started his career in mobile communications at T-Mobile and was responsible for the integration of fixed-line provider Hansenet into a management position at VIAG-Interkom. /o2. Today the student is the CEO of VMo2. “We are partially monetizing our tower infrastructure while maintaining joint operational and strategic control over key assets while we deploy 5G in more parts of the country and improve 4G connectivity. This transaction fits well with our core infrastructure and capital allocation strategy, which is,” it states. However, Virgin Media o2 will continue to invest in the UK to expand and improve our next generation fixed and mobile networks.”

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412 million euros in revenue and 24 billion euros in debt

VMo2 will therefore have 412 million euros in its coffers, but according to telecomtv’s calculations, this is only a “piece of cake” in relation to the network operator’s current net debt, which, according to the third quarter earnings statement, amounts to 412 million euros. Nearly 24 billion euros.

Landline and mobile communications with good prospects

VMo2 now reaches 16.7 million households via landlines and has a nationwide mobile network. This will allow VMo2 to expand its broadband and mobile contract customer business, which should bring new money into its coffers to pay down debt.

In the third quarter, VMO2 added nearly 41,000 new fixed broadband customers, bringing the total number of customers to 5.7 million. There are customers who have stopped by recently Acquisition of altnet provider Upp Added, not yet taken into account. There are also 50,000 new mobile contract customers, bringing the total number of customers to 16.1 million. VMo2 has also connected nearly 11 million Internet of Things (IoT) devices to its network and has added nearly 386,000 devices since the end of the second quarter.

To make the numbers look even better, VMo2 counts all active SIM cards, including wholesale/service providers, IoT and prepaid customers, providing a staggering 44.6 million customers.

Total group turnover rose 7.1 percent year-on-year to more than €3 billion, although this also includes income from the “Nexfibre” joint venture, in which VMo2’s parent companies, Liberty Global and Telefónica, each share 50 percent. . . Without these factors, revenues would have increased by only 1.3 percent. So-called “adjusted earnings before interest, taxes, depreciation and amortization” rose 5.6 percent to nearly 1.2 billion euros. Given the overall economic situation, VMo2 expects revenues to remain “stable” and no growth is expected.

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Liberty Global: Only VMo2 posts good numbers

Virgin Mobile o2’s results were released at the same time as those of Liberty Global, one of its parent companies. Parent company Liberty Global has sold Unitymedia’s cable TV network in Germany to Vodafone Germany. Liberty is active in Great Britain, Ireland (Virgin Media), the Netherlands (VodafoneZiggo), Belgium (where it recently acquired the entirety of Telenet), Switzerland (where it bought mobile operator Sunrise and entered into a partnership with cable network operator UPC-Suisse that was merged) and Slovakia (UPC).

Liberty recorded third-quarter revenues of 1.74 billion euros, an increase of 6.2 percent year-on-year, and adjusted profits of 563 million euros, a decrease of 10 percent. Investments in Great Britain and the Netherlands were not included in the group’s figures at all. suspects that people at Liberty’s headquarters may not be really happy, given that VMo2 was the only holding company in Great Britain that managed to increase its customers on fixed-term contracts in the quarter.

There has recently been discussion about whether VMo2 will have to cut 2,000 employee positions.

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