TORONTO, ON / ACCESSWIRE / November 5, 2020 / Woori BMO Group has today commented on Hong Kong billionaire Li Ka-shing's CK Hutchison Holdings as it closes in on a sale of its European wireless tower unit to Spanish mobile towers operator Cellnex Telecom for around €10 billion (US$11.7 billion).
"CK Hutchison has been in advanced talks with Cellnex to sell 29,100 of its tower sites in the United Kingdom, Italy, Sweden, Denmark, Austria and Ireland," commented Andrew Williams, Director of Institutional Equity at Woori BMO Group. "According to our market intelligence team, both companies have reached an agreement on terms but are yet to make a final decision," he added.
In August, CK Hutchison, which has businesses in retail, logistics and other industries, shifted its European towers unit into CK Hutchison Networks, a recently formed entity under CK Hutchison Group Telecom Holdings, to operate its tower sites.
The business, which is headed by Li's son Victor Li Tzar-kuoi, faced a challenging outlook, particularly in the UK, where mobile network providers were barred from purchasing new equipment from China's Huawei Technologies after December 31, following sanctions against the company by the Trump administration. By 2027, each provider must also remove all of Huawei 5G equipment from their networks.
In an earlier statement, Cellnex reported that it was in advanced negotiations with CK Hutchison over "the potential acquisition of certain infrastructure assets and the execution of service contracts". Both companies indicated that no decision had been taken to move forward with any deal and that there could be no guarantee that transaction would take effect.
"If the deal goes through, it will be the biggest in the history of Cellnex and will expand its tower footprint by about 40% to beyond 100,000 sites. It will also lay the groundwork for Cellnex to join new markets like Austria, Denmark and Sweden," commented Christian Harper, Director of EMEA Wealth Management at Woori BMO Group.
Should the transaction goes through, Cellnex will also supply telecommunication infrastructure services to CK Hutchison and assist with its 5G network roll-out.
CK Hutchison Group Telecom Holdings reported €7.6 billion in revenue for the nine months through to September of this year, a drop of 4% compared with the same period last year, according to researchers at Woori BMO Group.
CK Hutchison said the proceeds from the European tower sale would be split with the minority partners of the business.
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Founded in 2007, Woori BMO Group is a full-service wealth management company providing both corporate institutions and private clients a tailored financial advisory service from its retail office in Toronto, Canada.
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SOURCE: Woori BMO Group