Cellnex buys Arqiva as the shake-up of Europe’s cell towers continues

There is a major shake-up happening in the European mobile infrastructure market, with Vodafone planning to spin off its towers, across its key markets, into a  separate company, and Telefónica considering a similar move. Now, Spanish towerco Cellnex is to pay £2bn ($2.45bn) for the telecoms assets of Arqiva, the UK’s largest pure-play tower operator. That will leave the UK company with just its original business, running broadcast infrastructure.

Cellnex, which operates in several European markets, notably Spain and Italy, will take control of Arqiva’s 7,400 cellular sites with the right to market an additional 900 sites. Through the deal, Cellnex inherits contracts with all four UK mobile network operators, or at least, the infrastructure networks they share – Vodafone and O2 have a network sharing joint venture called Cornerstone, while EE and Three share sites via their MBNL venture.

This deal will bring Cellnex’s total tower portfolio to 53,000 sites in seven European markets – Spain, France, Netherlands, Britain, Italy, Switzerland and Ireland. The Arqiva purchase brings to 24,000 the number of sites it will have added in 2019, almost doubling its catalog.

In September it announced the acquisition of Cignal in Ireland, which operates 546 towers and rooftops. That followed a deal, made with the UK’s BT in June, which enables  Cellnex to operate and market 220 high towers throughout the UK. Earlier this year, Cellnex signed long term strategic cooperation agreements with Iliad in France and Italy, and with Salt in Switzerland, to acquire 10,700 sites.

Arqiva still owns some 1,500 broadcast transmission sites and five teleports, supported by its global fiber network. It is not clear how many of the fiber assets Cellnex will gain, but the deal does include Arqiva’s concessions to use public street infrastructure as locations for wireless sites in 14 London boroughs, which will pave the way for dense 5G and smart city systems.

These assets will be important for the Spanish firm, which has been a pioneer in small cell infrastructure in Europe, using bus stops, billboards and other sites in its native Barcelona to support dense city access points.

Arqiva also jointly owns Freeview channel provider Digital UK, alongside the BBC, ITV, Channel 4 and Arqiva. Arqiva handles day-to-day technical management of the Freeview Electronic Programme Guide (EPG) for which Suitest, a Czech quality assurance start-up, has enabled remote automated testing.

“This agreement provides both stability and a focus for our future as we concentrate on the provision of broadcast infrastructure, end-to-end networks and connectivity solutions for our TV and radio customers, international content owners, data network providers and utilities,” commented Arqiva CEO Simon Beresford-Wylle.

“The majority of the sale proceeds will be used to pay down debt in Arqiva’s capital structure, securing the long term sustainability and financial security of the UK’s broadcast infrastructure,” it states.