Cellnex Telecom Clarifying implications of the Zegona agreement

研报英文原文证据摘录

Cellnex Telecom Clarifying implications of the Zegona agreement

major providers including Cellnex, American Tower, Totem and Vantage Tower. See

market overview in Figure 1Spaintowercountasat1Q26. This compares to three MNOs Telefonica, MasOrange

and Vodafone, and further potential consolidation ahead (link). Cellnex

management have repeatedly highlighted this as a structural imbalance with

tower consolidation as a possible outcome. Zegona somehow breaking the

contract with Vantage could be a catalyst towards such potential consolidation, in

our view.

We also note that Zegona has network sharing with Orange in rural Spain,

specifically in towns of less than 175k inhabitants. Should the two parties want to

extend this agreement to urban areas, we believe this would require material

investment as merging customer bases on a single urban network is a difficult

exercise without adverse impact on network quality. See our MasOrange CEO

Feedback for why.

The Friday news from Cellnex follows on from the Orange and Masmovil merger in

2024 (link) which has resulted in a streamlining and extension of the MSAs with

both until 2048 (link). We have repeatedly noted the MasMovil contract in

particular was one of the most at risk MSAs from potential carrier M&A, in our

view. This was due to factors including: 1) small scale of the network acquired (c6k

sites Masmovil on Cellnex MSA) vs. the host network (c19k sites Orange Spain

mainly on Totem); 2) the near-term, 2028 MSA expiry, which in theory gave the

host network time to try and replicate the Masmovil infrastructure; 3) hosting

capabilities of the acquirer Orange with its own towerco Totem; and 4) the need to

deliver on synergies in the Orange and Masmovil deal.

Figure 1: Spain tower count as at 1Q26

Spain

tower

coun

t as

Q26

at