Plenty of options for tower buyer

Parties lining up for the Optus towers that are set to hit the market shortly will be acquiring not only the assets but the chance to develop other towers in the future.

The process should start in earnest in the next few months. Suitors will have the opportunity to buy towers that count Optus as the anchor customer as well as future developments.

Axicom, the former Crown Castle operation, remains the favourite to win the competition, providing the Australian Competition & Consumer Commission has no objections.

Optus is already a customer of Axicom’s, and one question is whether the Singaporean-owned telco will only want to be dealing with a telecoms provider for services in its future negotiations.

But it is understood that the buyer of the Optus towers would see long-term agreements in place as to what they are signing up to.

The process, run by Bank of America, is expected to involve a lot of transparency about pricing.

So far, estimates suggest that the towers could be worth $2bn.

Axicom was purchased from Crown Castle in 2015 for $2bn.

In recent years, it purchased 56 communications towers from Southern Cross Media, expanding its reach across regional Australia.

Other under bidders from that auction could line up again, including AMP Capital, Morrison & Co, Brookfield, Providence Equity and Palisade Investment Partners.

The expectation is that Singaporean parent Singtel will sell the towers in their entirety and either repatriate the funds or use the proceeds to fund the rollout of 5G infrastructure.

Singtel launched a strategic review of its Optus Satellite business in 2013, and an initial public offering was among the options for what then was seen as a $2bn operation.

Intelsat SA and a consortium made up of Blackstone, TPG Capital and Malaysia-based MEASAT Global bid for the assets, and Kohlberg Kravis Roberts and Apollo were also reportedly looking, but the sale was abandoned.