KKR, Ardian and Cellnex weigh offers for TDF

15 January 2019 - 12:00 am UTC

KKR and Ardian’s infrastructure funds, as well as Spanish telecommunications business Cellnex, are considering bids for Brookfield and PSP investments stakes’ in French telecoms giant TDF, sources said. 

Morgan Stanley and BNP Paribas were mandated as the sell-side advisers for Brookfield and PSP investments, which are looking to sell their 45% and 22.5% stakes respectively.  

Brookfield, PSP investments, BNP Paribas and Morgan Stanley declined to comment.

Two advisor sources said KKR Infrastructure is considering bidding, while Ardian Infrastructure is “seriously looking” at the sale, according to a third advisor source. Barcelona-headquartered Cellnex is also believed to be considering a bid.

Ardian declined to comment. Cellnex and KKR did not respond to comment by press time.

TDF operates 13,900 telecommunications tower sites, fibre-optic broadband and provides television and radio broadcasting services. The Paris-headquartered business posted annual re-adjusted EBITDA of EUR 355m in 2017.

A banking source said the entire business is likely to fetch a multiple of between 15-20 times EBITDA.

The towers and fibre’s multiple is expected to be in line with the 18x paid by KKR for a 49.9% stake in Altice’s French telecoms towers business SFR TowerCo. It could even fetch more, given the SFR sale involved a minority stake. 

TDF’s riskier broadcast business could reduce the overall price – with one source saying these assets could fetch around a 13 times EBITDA multiple.

Brookfield, PSP Investments, APG and Arcus acquired TDF for EUR 3.56bn from Ardian, TPG, Charterhouse and French state-owned investment entity Bpifrance in April 2015.

The transaction had an EBITDA multiple of 9.5 times based on the business’s EBITDA of EUR 373m for the year ending March 2013.

Crédit Agricole Assurance subsequently acquired a 10% stake in the business for around EUR 215m in May 2015.

APG and Crédit Agricole Assurance currently hold 22.5% and 10% stakes in TDF respectively. Arcus Infrastructure holds a small non-controlling ownership interest in PSP’s and APG’s vehicles.

The business recorded EUR 676m in consolidated sales from its 2,300 clients in 2017, which were split between telecommunications (47%), television (26%) and radio (17%) services.


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