Orange will segregate its tower business in France and Spain to create TOTEM

Carlos Manso Chicote

Madrid

Updated:

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The parade of results of the main telecos continues, which will culminate on February 25 with Telefónica, and this Thursday it was the turn of Orange. The teleco gala has announced the creation of its own Torres subsidiary, called TOTEM, which will initially integrate the 17,600 towers owned by the operator in France and the 7,900 telecommunications sites it has in Spain. In any case, unlike the cases of Telxius (Telefónica) and Vantage Towers (Vodafone), the will of the French operator is to maintain a majority stake in the future firm. “They are critical assets and we want to maintain control”, has asserted the CEO of Orange Spain Jean-François Fallacher who has given as an example what has been done with the fiber network in France or with the real estate assets of the large hotel chains.

Specifically, according to the French group, last year the towers generated an estimated revenue of 500 million of euros with an EBITDAaL (gross operating profit before deducting financial expenses measured in annual terms) of 300 million euros of which two thirds were generated in France. This represents a margin of 57%, including maintenance costs that are calculated at 5% of the revenues of the future Torres subsidiary. In any case, Fallacher has assured, this will allow “More focused management” and it will generate higher profitability, which he estimates could be between 21% and 30% in the long term.

Regarding the figures for Orange Spain, the subsidiary of the French operator closed last year with revenues of 4,951 million euros, 5.9% less than the previous year and a 13% drop in EBITDAaL of 1,433 million euros. What the telecom has attributed to the Covid health crisis and a collapse in billing for roaming and prepaid due to the collapse of 80% of tourism. TAmpco helps the strong competition of the low cost, although they have pointed out from the French company that the year has been satisfactory from a commercial point of view. Especially because of the positive trend in the second semester.

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