Macquarie’s recent $3.5 billion sale to AustralianSuper and Singtel

AustralianSuper and Singtel’s company, Australian Tower Network (ATN), has recently won the auction for Axicom. Early this month, Macquire’s Axicom was looking for buyers and had settled for ATN.

Shareholders from both ATN and Axicom signed the $3.5 billion deal early this month. The deal would allow ATN to add around 2000 of Axicom’s telco towers to their existing portfolio. This would double ATN’s portfolio to around 4000 towers which is currently behind Telstra’s roughly 7700 towers. Making ATN’s portfolio the second largest in Australia.

This would tighten AustralianSuper’s grip on the local infrastructure sector as they have recently purchased a majority stake in Optus’ mobile tower network back in October last year. This deal was worth $1.9 billion. This price tag was a representation of an enterprise multiple of 38 times the earnings of the 2021 financial year, thus making this purchase the highest relative price paid for telecom tower assets around the world.

The Axicom deal was a major result for Macquarie Asset Management (formerly known as MIRA) and its co-investors at Axicom, which includes ADIA and UniSuper. These co-investors had purchased Axicom from Crown Castle for $2 billion back in 2015. They had renamed the portfolio to Axicom, which started with around 1700 mobile communication towers.

Macquarie Capital and Gilbert + Tobin had run an auction spanning the previous six months to fund a buyer. The demand for telecom towers had reached a global scale. ATN, advised by Jefferies and Allens, had won against global interest from OMERS (Canadian pension fund) and DigitalBridge (US company).

ATN was the most likely candidate to win the auction as AustralianSuper, along with their deeper pockets, already had a portfolio of telecom towers and an infrastructure to link the additional towers to their existing portfolio.

For the 2022 financial year, Axicom expects to bring in $235 million in revenue and $150 million EBITDA. This is according to information sent to potential buyers during the auction period.

All in all, Macquarie Group has sold a company they have invested in seven years ago and have made a decent profit. This deal has wrapped up a long six months period for all the parties involved, each would have achieved their desired outcome.

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Sources: ASX, Telecoms, Wikipedia, Macquarie, Statista, AFR