Speculation about what Deutsche Telekom (DT) plans to do with its mobile towers portfolio has been swirling for months, with reports suggesting that various interested parties have been putting forward bids to tempt the German telco to join the towers sell-off frenzy.

It's now being reported that US investor KKR is emerging as the frontrunner to buy a stake in DT's tower business, in a deal that could value the unit at about $20 billion.

KKR is understood to have made an offer with Global Infrastructure Partners and Stonepeak. Citing unidentified sources, Bloomberg reported that the KKR-led bid is deemed more attractive than a rival proposal from Brookfield Asset Management and Spain-based Cellnex Telecom.

The news agency also suggested that DT could make a decision this week, although sources are said to have stressed that other bidders could emerge or the telco could still opt to keep the assets.

Only last week, Reuters also reported that Cellnex had offered DT a stake of less than 10% in its own business as part of efforts to acquire the towers unit. Cellnex and DT certainly have form when it comes to creative tower deals, as shown when they merged their respective Dutch mobile tower businesses into Cellnex Netherlands BV (Cellnex NL).

Big deal

As things stand, a DT unit called GD Towers owns and controls about 40,600 masts in Germany and Austria. Around 33,000 towers are based in Germany alone and are directly managed by Deutsche Funkturm (DFMG). Magenta Telekom Infra (MTI) operates 7,000 sites.

Bloomberg noted that the sale of a stake in DT's tower business could be one of the largest infrastructure deals in Europe this year.

Want to know more about 5G? Check out our dedicated 5G content channel here on Light Reading.

Some of DT's European peers have already taken the plunge by selling or spinning out tower assets: Telefónica sold its towers to ATC, for example. Orange created a tower unit called Totem, while Vodafone set up Vantage Towers to manage its tower portfolio. Earlier, Vantage was said to have been among the suitors for the DT assets, although it's not clear if that is still the case now.

Over in Asia, Light Reading has long been reporting on Asia's mania for mobile tower sales, with both telcos and investors keen to strike deals. For instance, Bloomberg recently reported that Manila-listed Globe Telecom is considering selling half of its tower portfolio in a deal that could be worth up to $1.5 billion. The news agency said around 6,000 towers could be up for grabs.

Related posts:

— Anne Morris, contributing editor, special to Light Reading