The two UK transmitter giants have merged into one, as Arqiva this week acquired the old Crown Castle properties that formed National Grid Wireless for £2.5 billion ($4.9 billion).
National Grid Wireless is the UK’s biggest wireless network and manages two of the DVB-T digital TV multiplexes, runs the BBC television and radio transmissions and hosts hundreds of mast and tower sites for major mobile networks.
Australian group Macquarie created Arqiva when it bought the NTL transmission business in December 2004 for $2.4 billion and then went on to buy BBC Broadcast for $303 million the following year, dropping them both into a UK holding company Macquarie UK Broadcast Ventures.
The UK electricity distributor National Grid acquired the Crown Castle UK assets in 2004 for $2 billion so the sale brings it a tasty profit of some $2.4 billion for holding the assets for just three years. This sets a new trend in acquisition pricing for wireless networks, at a multiple of almost 20 times 2006 EBITDA. Deals in this sector have previously gone for around 10 times earnings. Perhaps that’s the price Macquarie has had to pay for what should now be considered national dominance in broadcast and wireless networks. Now when the government tries to implement digital switch over and re-licenses all that UHF spectrum in 2012, everyone will only have to deal with one company.
The transaction will be subject to a review by the UK Competition authorities which is likely to last 12 months at least.