29 February 2012
Moscow – Macquarie Renaissance Infrastructure Fund (MRIF or the Fund) has agreed to invest US$50 million in Russian Towers (the Company), an independent operator and developer of telecommunications tower infrastructure in Russia, serving the mobile telecommunications industry. The investment is part of a $100 million equity investment round in which MRIF is acting as a Lead Investor. The Company’s current shareholders, UFG Private Equity and the European Bank for Reconstruction and Development, have invested an additional $15 million alongside MRIF in this round.
MRIF has agreed to acquire newly issued shares in Russian Towers to support expansion of the Company’s tower portfolio across the country. This will be achieved through construction and acquisition of towers. The first investment round closed in 2010 and was led by UFG Private Equity, the European Bank for Reconstruction and Develoment and founders of the Company.
Russian Towers is a leading independent telecommunications tower owner and developer in the Russian market. The Company was founded in 2009 by the Company’s management, with UFG and EBRD joining as shareholders in 2010. The Company already has a portfolio of over 300 towers currently operating or under construction across twenty regions of Russia. Russian Towers leases space on each tower to multiple tenants and has secured lease contracts with all major mobile phone operators in Russia for its towers. The new investment round should allow the Company to expand its tower park to over 1,000 towers in the next three to four years.
Chief Executive Officer of MRIF, Mr. Damian Secen, said: "The investment case for towers is very compelling in Russia. Mobile penetration is very high and there is rapidly growing demand for reliable network coverage.
This business model has proven to be successful in other markets and we are pleased to have made this investment in the growing Russian market."
Mr Hasnen Varawalla, Co-Chairman of MRIF, said: "We are delighted to join UFG and EBRD, together with the founders of this business, as a major shareholder. The telecommunications industry is a very exciting one – the trends in emerging markets are high usage, swift take-up and a large demand for infrastructure. We are delighted to be playing a role delivering that infrastructure."
Investment in Russian Towers is MRIF’s third investment, following Brunswick Rail in December 2010 and GSR Energy late in 2011. This brings total Fund investments to more than US$250 million.
Macquarie Renaissance Infrastructure Fund is jointly managed by Macquarie and Renaissance. It is the first major private fund dedicated to investing directly in infrastructure in Russia and other key CIS markets, with $630 million of investor commitments.
MRIF has a diversified portfolio with interests in transportation (Brunswick Rail), power (GSR Energy) and telecommunications (Russian Towers) infrastructure. MRIF continues to actively seek quality investments which will make a significant contribution to modernising infrastructure in the CIS.
MRIF’s investors include cornerstone investor Vnesheconombank (the Russian State development bank), Eurasian Development Bank, European Bank for Reconstruction and Development, the International Finance Corporation, Kazyna Capital Management (a subsidiary of the Kazakh sovereign wealth fund), Macquarie and Renaissance.
Governments in the CIS region have recognised the significant need to renew and expand infrastructure to facilitate economic growth. MRIF is committed to being a key player in this development.
Macquarie Infrastructure and Real Assets (MIRA), part of Macquarie Group, is a leading global alternative asset manager specialising in infrastructure funds, other real asset funds and customised accounts. Established in 1996, it is the largest manager of infrastructure assets in the world with team of over 350 experienced professionals managing funds with more than $US90bn of assets under management, including investments in 88 infrastructure assets which include the leading broadcast towers operators in the UK (Arqiva) and the Czech Republic (CRa). MIRA’s in-depth operational expertise and active asset management, combined with access to deal sourcing capability, provide a unique competitive advantage for investors under a philosophy of responsible ownership. Macquarie Group is a global provider of banking, financial, advisory, investment and funds management services. Founded in 1969, Macquarie employs more than 15,000 people in 28 countries and has assets under management of $317bn*.
*As at 30 September 2011
Renaissance Group is an independent group of unified finance, investment and management companies specialising in creating value in high-opportunity emerging markets. The Group consists of investment banking, asset management, merchant banking, consumer credit, real estate and advisory businesses. Renaissance Group operates in 19 countries and regions, including Russia, Ukraine, Kazakhstan, Africa, Hong Kong, the United Kingdom, the United States and Cyprus.
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