Vodafone to transfer its 50% shareholding in JV Cornerstone to Vantage Towers

Vodafone's stake in United Kingdom mobile masts business Cornerstone will be moved into Vantage Towers, the infrastructure giant eyeing a €20bn (£18bn) listing in Germany.

Cornerstone will be the preferred supplier of new tower sites for the two mobile operators' United Kingdom units for an initial eight years from the start of this month with three eight-year renewal periods under the new deal, Vodafone said on Monday. Vantage Towers will have 82,000 macro sites and will operate in 10 European markets with leading positions in nine, it added.

Vodafone UK and Telefonica UK have each entered into long-term Master Services Agreements (MSA) with Cornerstone, which have initial terms of eight years from 1 January 2021, with three, eight-year renewal periods, and which establish Cornerstone as a preferred supplier of new sites for both operators.

Vodafone and Telefonica said they have agreed a commercialisation deal for Cornerstone, a 50:50 joint venture, which essentially means it is open for business for other network operators that might want to use its towers.

Cornerstone has pledged to build 1,200 new sites by 2025 for Vodafone and O2.

"Given the quality and reach of its infrastructure, Cornerstone is well placed to capture a significant portion of the additional market tenancies required for densification and coverage in the UK", Vodafone said, in a statement. "We look forward to working with our anchor tenants to power the UK's digital transformation, enabling the roll-out of 5G networks to benefit business and consumers". Vodafone's 50% stake in Cornerstone would add EUR62 million to Vantage Towers' pro forma 2020 financial year adjusted earnings before interest, tax, depreciation and amortisation after leases, it said.

Shares in Vodafone were up 0.2% at 128.69 pence in London early Monday, while shares in Telefonica were down 0.2% at EUR3.56 in Madrid.