Tower Due Diligence

Tower transactions are a vital aspect of the telecommunications industry. However, these transactions can also be complex and time-consuming, requiring a thorough understanding of the industry and the specific assets involved.

What is Due Diligence in Tower Transactions?

Due diligence is the process of thoroughly evaluating a potential investment or acquisition before committing to a deal. In the context of tower transactions, due diligence typically involves assessing the technical, financial, and legal aspects of the assets being acquired. This can include evaluating the location, condition and capacity of the towers, as well as the terms of any leases or agreements associated with the assets.

Key Considerations for Tower Transaction Due Diligence

  • Technical evaluation – A thorough technical evaluation is essential for understanding the condition and capacity of the towers being acquired. This can include assessing factors such as structural integrity, height, and loading capacity. It is also important to consider any potential future upgrades or modifications that may be necessary.
  • Lease and agreement review – Reviewing the terms of any leases or agreements associated with the towers is a crucial aspect of due diligence. This can include evaluating the length and terms of any leases, as well as any potential liabilities or obligations associated with the agreements.
  • Financial analysis – A financial analysis is important for understanding the potential return on investment for the towers being acquired. This can include evaluating factors such as revenue potential, operating costs, and potential future cash flows.
  • Legal review – A legal review is essential for understanding any potential risks or liabilities associated with the towers being acquired. This can include assessing factors such as zoning and permitting requirements, as well as any potential environmental or safety hazards.

Tower transactions can be complex and time-consuming, but a thorough due diligence process can help to ensure a successful deal. By evaluating the technical, financial, and legal aspects of the assets being acquired, and considering key considerations such as lease and agreement review, financial analysis, and legal review, investors can make informed decisions and mitigate potential risks.

What is an Automated Analysis of Active Inventory?

Automated drone surveys don’t just provide more data, they provide better and more accurate data. Aerial surveys go beyond standard reports and present a holistic view of assets. Customers can receive a 3D digital model of a tower, allowing for accurate visualization, analytics and measurements.  Users can zoom in on any area of the asset for a detailed view. AI-driven analytics can identify relevant points: highlighting unutilized mounts and any free space available for future rental, or areas that may require maintenance like cracks or damage.

In addition to providing a detailed understanding of a tower, an automated drone survey offers a huge amount of data about a site and its environment, answering questions that an M&A team may not even have asked. Line of sight evaluation provides valuable insights about the competitive environment and the surrounding areas. A 360° “virtual tour” of the site can add even more information.  Are there other towers in the area?  Are there challenges to access the site? Is the environment rural, or difficult to reach in some seasons?  Are there other physical aspects of the surroundings that could impact the site?  This digital data is not only unquestionably accurate – it can be easily shared with all parties concerned, wherever they are.

Examples of M&A Transactions in the Tower Industry

 

Year of deal Country Seller Buyer Tower count Deal value (€)
2020 Austria, Denmark, Ireland, Italy, Sweden, UK Hutchison Cellnex 24,600 10,000,000.000
2020 Poland Iliad Cellnex 7,000 800,000,000
2021 Iceland Syn and Nova islandsTurnar 367 91,000,000
2021 Russia VEON Service Telecom 15,400 847,800,000
2021 Poland Polkomtel Cellnex 7,000 1,600,000,000
2022 Belgium Telenet Digital Bridge 3,322 745,000,000