MANILA, Philippines — Globe Telecom Inc. has raised P52 billion from the disposal of its passive assets, leaving it with P44 billion to collect from the remainder of its tower sale.
In a regulatory filing, Globe said it has completed the transfer of the fourth batch of 113 towers to Frontier Tower Associates Philippines as part of their sale and leaseback agreement.
For this tranche, Globe received P1.4 billion for a tower set made up of 77 percent ground-based units and 23 percent rooftop assets situated in Luzon, Visayas and Mindanao.
Globe said it also handed over another portfolio of 100 towers to MIESCOR Infrastructure Development Corp. (MIDC) for P1.2 billion. Broken down, the batch comprises 64 towers on the ground and 36 on rooftops.
In all, Globe has generated P26.6 billion and P13.4 billion from sale and leaseback deals with Frontier and MIDC, respectively. Likewise, Globe has turned over 2,094 of the 3,259 units acquired by Frontier and 1,120 of the 2,180 assets bought by MIDC.
With this, Globe has cashed in P51.9 billion of the P96.32 billion it estimates to get once all of the towers are transferred to their buyers.
Apart from Frontier and MIDC, Globe sold 1,350 towers to PhilTower Consortium Inc. and 447 others to Unity Digital Infrastructure Inc. in line with its strategy of minimizing passive assets in its portfolio.
Through the tower sale, the Ayala-led telco hopes to reduce its debt as a ratio of earnings before interest, taxes, depreciation and amortization to the pre-pandemic level of 2.2 times.
Fitch Group unit CreditSights expects the tower sale to contribute to the improvement of Globe’s credit standing in the second semester. Between July and December, CreditSights believes Globe will liquidate P47.2 billion in proceeds from its asset disposal.
“We also anticipate residual P47.2 billion of tower sale closures through the second half of 2023, but with a slim chance of delay beyond 2023. This should boost liquidity and lessen the need for additional debt insurance,” CreditSights said.
Globe chief finance officer Rizza Maniego-Eala said the transaction would allow the telco to focus its network rollout on active infrastructure now that passive assets are operated by tower builders.
“The business of Globe is a capital intensive one and this transaction that we initiated with tower companies has proven to be a great complement to our rollout of critical infrastructure to achieve wider coverage and consistency of service across the country,” Eala said.