Activist investor Elliott Management has taken a stake in Vantage Towers as the biggest shareholders of the Germany-listed phone mast business prepare a takeover of the company.
Paul Singer’s investment firm has 5.6 per cent of the voting rights in Vantage, the group spun off two years ago from Vodafone, according to a filing released on Tuesday.
It marks Elliott’s latest foray into Germany after it took a stake in Fresenius, the world’s largest dialysis company, last year.
The New York-based group disclosed its position after Vantage’s new owners launched a voluntary takeover offer for the company’s outstanding shares that could lead to it delisting in Frankfurt.
In November, Vodafone transferred its 82 per cent stake in Vantage Towers to a new entity that it will jointly control with a group of private investors including KKR, Global Infrastructure Partners and Saudi Arabia’s Public Investment Fund.
The new entity then launched a voluntary takeover offer for the 18 per cent of remaining shares.
However, Elliott’s new position could disrupt that process. The investment firm has previously taken advantage of German law to take stakes in takeover targets and push for higher offers.
Vantage operates tens of thousands of mobile towers across 10 European countries including the UK.
Masts, the metal structures that support radio antennas, were some of the most valuable assets in telecoms during the era of cheap debt, trading at high multiples and offering private investors attractive returns.
However, rising interest rates have driven up the cost of capital for these indebted businesses, causing their shares to tumble.
As part of the agreement to transfer its controlling stake in Vantage Towers in November, Vodafone will sell up to 50 per cent of the mobile phone masts business to the consortium of investors.
That deal gives the groups exposure to one of Europe’s largest masts businesses, a key piece of communications infrastructure, while freeing up cash for Vodafone, which has been under pressure to revive sluggish performance.
Competitor Cellnex, the largest mobile tower company in Europe, has separately faced its own challenges in the aftermath of a three-year dealmaking spree. Its founder and chief executive Tobias Martínez resigned earlier this month.
Elliott has been active at the start of this year, notably building a multibillion-dollar position in software company Salesforce.
Vantage on Tuesday reported a 4.8 per cent rise in revenue to €263.7mn for the third quarter, citing inflation and tenancy growth for the increase.
Shares in Vantage rose 1.5 per cent by Tuesday afternoon after Elliott’s position was disclosed.
Elliott holds about 3.5 per cent of Vantage shares, with the remaining voting rights controlled through other instruments.
Elliott declined to comment. Vantage confirmed the news but declined to comment further.