MTS is considering a company restructure to separate its tower and data center units.
The Russian telco’s Board of Directors have agreed an agenda for an Extraordinary General Meeting of Shareholders scheduled for September 30, 2021.
During the meeting, there will be a vote on:
- Separating out MTS’ passive infrastructure (towers and related assets) into a wholly-owned subsidiary, Tower Infrastructure Company LLC (TIC).
- Separating out MTS’ active network and digital infrastructure (fixed-line, data center, and cloud computing) into a wholly-owned entity, MWS-1 LLC.
- Integrating the newly formed MWS-1 LLC into MTS’ existing wholly-owned subsidiary, MTS Web Services JSC.
TIC LLC would have an initial capital of 25 million rubles ($341,250) and own around 23,000 towers. As well as drawing fresh investment, MTS said the new tower firm could become a “partner of choice” for other MNOs for network equipment installation.
“The spun-off TIC LLC would have the largest portfolio of antenna mast structures in Russia and one of the largest in Europe, making it a potentially attractive business for sector-specific investors,” according to company documents. “If MTS’s tower assets were to be monetized, the company could gain additional proceeds that could be used to reduce debt and/or further invest in the development of MTS’s digital ecosystem.”
MWS-1 LLC would have an initial capital of 5 million rubles ($68,250), but once merged with MTS Web Services, would “create a powerful platform, take leadership, and create conditions for increasing the company’s market value,” according to the company.
Owners of MTS ordinary shares voting against the above items or those who abstain from voting will be eligible to submit their shares for buyback at the price of 326.73 rubles ($4.46) per ordinary share.
Owned by Russian conglomerate Sistema, MTS now has twelve data centers: four in Moscow, two in Nizhny Novgorod, one each in the wider Moscow Region, Leningrad Region, Samara, Novosibirsk, Vladivostok, and Krasnodar.