Sunday, December 3News That Matters

Mobile masts giant Arqiva eyes £6bn float

The communications infrastructure giant which owns thousands of mobile‎ phone masts across Britain has lined up a quartet of banks to prepare a bumper London stock market listing.

Sky News has learnt that Arqiva, which is owned by a consortium of Australian and Canadian investors, has appointed Barclays, Goldman Sachs, HSBC and JP Morgan to oversee the plan.

The recruitment of the syndicate of banks comes as Arqiva’s existing shareholders hold talks with a number of infrastructure investors which have expresed buying the company.

The so-called dual-track process – which could result in either a float or a sale of Arqiva – is at an early stage and may not be concluded until next year.

Arqiva operates more than 8,000 sites across the UK‎, with its mobile masts used by customers including EE, O2 and Vodafone.

Its owners believe the advent and widespread introduction of 5G‎ technology – for which the Government has signalled a package of support – will significantly increase the number of masts required across the country.

They also expect that technology to allow Arqiva to play an important role in the rapid growth of the “internet of things”, which enables household devices, for example, to be controlled remotely.

A sale of the business, which has recovered from a major financial restructuring, is expected to be a more attractive option to Arqiva’s shareholders than a flotation, assuming the valuations are broadly similar.

The company’s biggest investor is the Canada Pension Plan Investment Board, which holds 48% of the shares, followed by the Australian bank Macquarie, which directly owns a further 25%.

A number of other funds including the Motor Trades Association of Autralia own the rest of the shares.

Bankers say that Arqiva has drawn interest in the last few months from other large pension funds‎, sovereign investors and private equity groups which have launched long-term, lower-return pools of capital.

Arqiva employs more than 2000 people and said in May that its revenue and profits had grown strongly in the nine months to 31 March.

During the period, it made earnings before interest, tax, depreciation and amortisation of £351m, up 12% on a year earlier.

In addition to its core business of communications infrastructure provision to customers including Sky, the owner of Sky News, and ITV, it offers machine-to-machine connectivity devices such as smart meters for water and energy.

It is also running a trial in partnership with Samsung to offer 5G services in London using Arqiva’s spectrum.

The company has replaced its management team in the last couple of years, bringing in Simon Beresford-Wylie, a former Nokia and Samsung executive, as its chief executive.

In May last year, Liliana Solomon joined Arqiva as its chief financial officer, following stints at Vodafone and T-Mobile.

The company is now working on plans to install small cells on street furniture in London and other major cities, and said in May that it expects to receive orders from two mobile operators which want to boost street-level network capacity.

A spokeswoman for Arqiva declined to comment this weekend.

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