Singtel’s Optus is understood to have short-listed Macquarie Infrastructure Real Assets, AustralianSuper and the Kohlberg Kravis Roberts-backed consortium in the competition to buy a 70 per cent interest in its $2 billion Australian telecommunication tower portfolio.
Brookfield is also through to round two along with Australian telecoms tower company Stilmark, which is working with Canadian pension fund backer Omers and ATN International and is advised by RBC and Q Advisors.
It is understood that only a limited number of groups have made it through to the second round of the Bank of America-run competition.
Parties that made the short list were first revealed by DataRoom on Wednesday.
AustralianSuper is advised by Jefferies, while Kohlberg Kravis Roberts, with Queensland Investment Corp and Canada’s Ontario Teachers’ Pension Plan are through to round two.
That consortium is believed to be taking advice from investment bank Citi and advisory firm Gresham.
Macquarie Infrastructure and Real Assets is bidding with its Axicom business.
Axicom is the former Crown Castle telecommunication towers business and has been advised in the contest by Credit Suisse and Macquarie Capital.
It counts Optus as a customer.
MIRA ‘s Axicom had earlier been seen as the favourite by some to win the competition, providing the Australian Competition & Consumer Commission has no objections, but it may need to discount its existing services to Optus to win the seller over.
Crown Castle was purchased in 2015 for $2bn by a consortium led by MIRA.
Other groups that were thought to have been in the mix earlier were Digital Colony, Blackstone’s Phoenix Tower International and American Tower, one of largest global players.
Optus is only selling 70 per cent of the towers, and the logic is that this will align the interests of the customer and the owner of the infrastructure.
It is expected to use the proceeds of a sale to roll out 5G infrastructure.
The portfolio is being strongly contested at a time when mergers and acquisition activity is booming in the Australian infrastructure market amid a low interest rate environment.
The Future Fund and Morrison left the Optus competition after announcing last week that a consortium led by Morrison & Co and The Future Fund had agreed to buy a 49 per cent interest in Telstra’s telecommunications tower entity InfraCo for a price that values the business at $5.9 billion.
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