Investment banks Macquarie Capital and Jarden are believed to be well placed to aid Telstra with its corporate restructure announced on Thursday that could see it sell down a stake in its mobile towers business.
On Thursday, Telstra announced it would split the company into three separate divisions by 2021, including InfraCo, InfraCo Towers, which includes its mobile tower assets and ServeCo, which would consist of its products and services.
Telstra has previously called on the services for UBS when it comes to its investment banking work.
Aidan Allen was understood to have been working on the Telstra restructure before he departed UBS to join the recently formed rival Jarden Australia, so some believe that Jarden could wind up with a role.
However, Telstra used Macquarie Capital and JPMorgan in 2017 when it explored a possible securitisation and demerger of its long-term NBN contract.
The Australian telco giant, then worth about $54bn, was looking to split out the $5bn of revenue it would receive from the government for the NBN rollout over about 20 years to hold in a separate structure or sell to an infrastructure investor.
The Australian government reached an agreement with Telstra in 2011, where it would receive $11bn in compensation for the use of its copper network, $4bn of which related to payments for disconnecting customers from its phone network and migrating them to the NBN.
Within the payment was about $5bn of infrastructure access payments over the long term.
However, such a plan was blocked by the NBN.
Macquarie has strong expertise in the area of infrastructure and access to a number of large global investors.
Yet some have questioned the level of involvement Macquarie may have in a sale of its mobile towers, given its infrastructure arm, Macquarie Infrastructure and Real Assets, is an owner of tower competitor Axicom.
In an announcement on Thursday, Telstra said its Telstra InfraCo was established as a stand-alone business unit in 2018, which offered the flexibility to monetise different asset groups.
It added that it would look to monetise its mobile tower assets over time given the strong demand and compelling valuations for what was high-quality infrastructure.
A potential sale of the mobile towers was flagged by DataRoom last year as likely to be on the cards to raise more capital.
This was as Telstra remained in search of raising up to $2bn through divestments to strengthen its balance sheet.
Telstra prides itself on having the country’s largest and fastest network based on national average combined mobile speeds, and the value of its towers largely depends on the structure of any deal, but it is thought it would be worth well over $1bn.
Telstra chief executive Andrew Penn signalled on Thursday that a potential sale of the towers would capitalise on a strong level of interest from infrastructure investors eager to secure opportunities in a low-interest rate environment where few exist.
The potential sale comes as Bank of America works with Singtel’s Optus for a potential sale of its mobile towers in Australia during 2021.
Last year, investment bank UBS worked on the sale and leaseback of Telstra’s properties.
Telstra sold a 49 per cent interest in its portfolio of telephone exchange buildings to Charter Hall funds in July last year and it has also divested data centres to Hutchison Global Communications owner I-Squared Capital, netting the telco $160m.
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