2degrees announces sale of tower assets for $1.076bn

2degrees CEO Mark Callander says the move will enable further investment in 5G build and increase focus on its core business.

“We are incredibly proud of the network we have built and the coverage we deliver. For a challenger brand to be winning network awards like we have been over the last couple of years is almost unheard of.

“Today’s sale of 1,124 towers will allow us focus more on, and continue to invest in, innovative solutions and services for Kiwis while realising the value of our passive mobile assets. In addition, we have committed to another 450 locations with Connexa to provide even greater coverage and network density for 5G.”

2degrees will continue to own the active elements of its network, including the radio access equipment, spectrum assets, transmission and backhaul, ensuring a world-class network and customer experience.

“The network we have built is phenomenal, but towers and real estate is not where we innovate. What we do with the active network layer is key and will continue to be the focus of future investment – this is where we will differentiate and grow. You’ll continue to see laser focus on growth and value- add services from 2degrees, along with acceleration of digital-first customer experience, and new product development.”

Under the terms of the transaction, 2degrees has entered into a 20-year agreement with Connexa (plus rights of renewal) to secure access to existing and new towers, with an additional tower build and co-location commitment of 450 sites over the next 10 years.

Completion is subject to approvals from the Overseas Investment Office (OIO) and Commerce Commission and is anticipated to occur mid-2023.