Ganzi and Seiner on Andean Tower Partners’ acquisition of Torres Unidas

Just when we thought that the tower deal making for 2017 was over, Andean Tower Partners (ATP) announced the acquisition of Torres Unidas. The new entity will be the largest private tower company in the Andean region and will be led by former Torres Unidas’ CEO Daniel Seiner, while Estrella Zaharia, former President of ATP, will continue with her responsibilities as Chief Marketing Officer. In this exclusive interview, TowerXchange talked with the Founder and Executive Chairman of ATP, Marc C. Ganzi and CEO Daniel Seiner about the deal, what it means for the two companies and their teams as well as their business strategies going forward.

TowerXchange: First of all, congratulations for the recent deal and the creation of a powerhouse towerco for the Andean region! What can you tell us about the deal?

This transaction is indeed a transformative one for Andean Tower Partners. We are extremely excited to welcome Torres Unidas’ management team on board and Daniel Seiner’s leadership going forward. First and foremost, this transaction was about a great team of people, the possibility to combine forces with Torres Unidas, and expanding wireless infrastructure through the region with the premier best in class management team.

We’ve been following Torres Unidas’ impressive achievements over the past five and a half years, towards becoming one of the largest and more solid private entities in the Andean region. So the opportunity to finally combine it with Andean Tower Partners is thrilling. And it will mean a lot for our customers as well. We’ll offer the largest wireless site portfolio in the Andean region with 2,400 towers, 31,000 master lease sites, twelve DAS networks and a series of additional products such as rooftops, small cells and utility transmission poles – we believe the product offering for our carrier partners is compelling and second to none from a footprint and coverage perspective.

TowerXchange: What are the next steps in terms of management changes and portfolio integration?

This transaction offers us greater capability to compete for business in the region. You see, sometimes one plus one adds to more than two, and we foresee a significant increase in business demand for the next couple of years as well as an increase in our product offering. We are trying to keep every member of staff in place and ensure that the team is available to meet the needs of our clients and to ensure we are ready for the deployment of the next generation networks.

TowerXchange: So what’s in the cards for the future? Will you focus on build-to-suit or consider more M&A? Or maybe entries into new markets?

Our first focus is to integrate people, regional offices and portfolios. We are also very focused on maintaining and strengthening our co-brands in the markets and making sure we have a unified approach to how we best serve our customers.

Between Torres Unidas and Andean Tower Partners, we have a rather substantial build-to-suit pipeline of approximately 740 sites that we are building between Colombia, Peru and Chile. Plus we are working on some exciting small cells initiatives in the region. I believe that as carriers work to densify their networks, small cells and DAS will become a more relevant theme over the next couple of years and ATP is the leading developer of small cell networks in the Andean Region today.

Andean Tower Partners is able to deliver indoor and outdoor small cells solutions through a variety of products: our urban ePole solution, Indoor DAS systems, as well as traditional fibre feed outdoor small cells and nodes. Additionally, we have access to ISA’s 35,000 km of dark fibre which allows us to bring fibre to the tower for our clients in Peru and Colombia. All of this creates a holistic package of products and solutions that allows us to best serve our customers and remain ahead of our competitors.

So yes, while geographic expansion is always an interesting opportunity, we see a stronger opportunity to deepen and strengthen our relationships with our wireless customers in the three core Andean countries where we already operate, and that is where we will focus our people, ideas and capital.

In terms of M&A, there are always occasions to acquire portfolios in the region, but they’ll need to have the same credit qualities, location characteristics and underwriting discipline that Daniel has implemented in Torres Unidas for us to be interested. Most M&A opportunities in the region are overpriced, and we are and will remain very selective.

TowerXchange: Daniel, what can you tell us about the discipline needed to get to this milestone deal?

This transaction makes sense because our two companies have a very similar approach to business. Going forward, we need to maintain the same discipline and high standards in how we build towers, how we structure and negotiate ground leases, how we relate to the authorities and how we maintain our sites among other. All these while being responsive to the needs of our clients.

Over the past couple of years, there’s been a wave of newcomers, many of them under-capitalized, entering the market at rather aggressive terms. These newcomers have managed to create some uncertainty in the market by overpromising on terms and not delivering. We are now starting to see many of these players exit the market.

We will remain focused on having the best solutions available for our clients for their long term enjoyment.

TowerXchange: What have been the critical steps in the evolution of Torres Unidas from start-up to acquisition? What can other tower companies worldwide learn from it?

Our company story began in 2012 when Torres Unidas was founded and the company acquired a portfolio of 350 sites in Peru. The following year we made acquisitions in Chile and Colombia. We continued our expansion in 2014 and 2015 with the acquisitions of the OLO portfolio in Peru and Nextel portfolio in Chile. While these acquisitions marked huge milestones for Torres Unidas, the key to our evolution has been to always be responsive to our clients’ needs in terms of new construction and co-locations, while maintaining a high level of financial responsibility and discipline.

TowerXchange: What can we expect for 2018? More consolidation in the cards for the CALA region?

The Torres Unidas transaction is a leading indicator that consolidation is going to be a theme in the future. In fact, some of the key equity sponsors in the region are reaching their third, fourth and fifth year of commitments and might be looking at monetizing their investments soon.

While I believe that there will be more opportunities to consolidate in the region, we’ll look at each portfolio selectively, and the ATP discipline will remain the number one driver of our business. We’ll only seize the right opportunity at the right price, with the right credit attributes and collateral.

We are keenly aware that in 2017 new site construction costs were far lower than per tower M&A prices and that is an important metric for us and the sector to consider. In 2018, Andean Tower Partners will remain a value conscious buyer and builder of sites while looking to increase our footprint and adding value for our customers with innovative site solutions. At the end of the day, we exist primarily to serve our customers, so the most important driver will be serving their needs with infrastructure that is delivered on time and at the right value proposition for their business plan and needs.