Virgin Media O2 (VMO2) is reportedly close to finalizing a deal to sell an additional 8% of its stake in Cornerstone, the tower infrastructure joint venture (JV) it operates alongside GLIL Infrastructure and Vantage Towers.
The transaction is reportedly valued between GBP 150 million and GBP 160 million, positioning Cornerstone’s overall worth at approximately GBP 1.9 billion (EUR 2.3 billion). While this valuation is slightly lower than the GBP 2.2 billion figure from the October 2023 sale of a 16.67% stake to GLIL, it remains close to VMO2’s target earnings multiple of 18.7×, which was reached in the previous deal.
The latest move will reduce VMO2’s ownership of Cornerstone to 25.33%, with Vantage Towers maintaining a 50% stake, making it the largest shareholder. The buyer, infrastructure investment group, Equitix, continues to expand its UK digital infrastructure presence. Equitix, which manages over USD 14 billion in assets, has investments in several UK alternative networks, including Freedom Fibre and Gigaclear, and digital assets outside the UK.
This stake sale forms part of a broader strategy initiated by VMO2’s co-owners, Liberty Global and Telefónica, to offload half of their original 50% stake in Cornerstone. This process began in February 2023 when JPMorgan Chase & Co. and Goldman Sachs were brought on board to facilitate the sale. At that time, Reuters had valued Cornerstone at USD 3 billion (EUR 2.7 billion).
Despite the ongoing sales, VMO2 remains a crucial customer of Cornerstone. VMO2 and Vodafone UK renewed their long-term service agreements with Cornerstone in 2021, with VMO2 reiterating that the JV remains a “critical supplier” to the operator.
Also Read: Virgin Media O2 Seeks External Investors for GBP 5 Billion Network Venture
UK Tower Market Reshuffles Amid Operator Mergers
The sale comes during significant shifts within the UK’s tower sector, notably driven by the proposed merger between Vodafone UK and Three UK, which has sparked new network-sharing agreements. VMO2 and Vodafone have agreed to extend their existing mobile network-sharing arrangement for over a decade, with the deal also granting VMO2 access to Vodafone’s spectrum, should the merger be approved.
Meanwhile, Mobile Broadband Network Limited (MBNL), the tower JV between BT and Three, saw a portion of Three’s mobile sites sold to Cellnex UK in 2022. While BT and Three have scaled back collaboration on site development, both companies remain committed to the JV until at least 2031.
The evolving landscape underscores the ongoing consolidation and strategic partnerships in the UK’s telecom infrastructure sector as operators aim to optimize costs while expanding network capabilities.
