Vodafone subsidiary on the stock exchange: Vantage Towers with billion-euro start

From Constantin Röse,
ARD Stock Exchange Editor

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Dead spots, slow internet, no reception: you can still hear about such conditions in Germany. But the expansion of new technologies such as 5G is progressing, albeit not at the same pace as in Asia or the USA. Network providers such as Telekom and Vodafone have invested billions of euros in the expansion in recent years, explains Andreas Mark, Union Investment fund manager: “Companies have to think carefully about how they can handle the high investments, that is, how they present the financing And of course it’s attractive to look at the towers. ”

“Towers” – these are cell towers. Antennas are attached to it to provide reception and enable phone calls or mobile internet. The providers either own their own towers or rent them from competitors. The British mobile phone company Vodafone now wants to cleverly exploit this. The head of the new subsidiary Vantage Towers, Vivek Badrinath, explains that more antennas are to be placed on the radio towers and used commercially.

Vantage Towers currently operates more than 80,000 radio towers in several European countries. A large part of it is in Germany. With the IPO, the parent company Vodafone was able to collect a total of 2.3 billion euros; the money should be used to repay debts. But it is also the largest IPO this year to date. Vantage boss Badrinath says he is happy with how it went; it was an exciting moment.

5G is a profitable business

The first price of the Vantage Towers share was EUR 24.80, around three percent above the issue price. What makes Vantage Towers attractive from an investor’s point of view? It’s the long leases with providers. They promise secure income. And: Vantage Towers wants to grow further, build more radio towers and buy additional companies.

Network expansion is a major issue for the entire industry. Tim Höttges, head of Telekom, puts it this way: “The future is 5G. In Germany alone we put 12,000 antennas into operation during the Corona crisis.” With the 5G network, for example, industry is to be networked in the future. There are also opportunities for autonomous driving, and 5G can also be used to surf the Internet even faster and even implement applications in real time. Experts say that it will take a few more years before it is finally ready for nationwide coverage.