Virgin Media O2 will retain a 33.33% stake in Cornerstone upon completion of the transaction

U.K. telco Virgin Media O2 has reached an agreement to sell a 16.67% minority stake in its mobile tower joint venture, Cornerstone Telecommunications Infrastructure Limited, to the U.K.-based infrastructure fund, GLIL Infrastructure.

In a release, Virgin Media O2 said it will receive approximately £360 million ($439 million) payable in cash at closing of the transaction, adding that it will retain a 33.33% stake in Cornerstone upon completion of the transaction.

The telco said the transaction has been structured through a Virgin Media O2 holding company, which owns 50% of the Cornerstone shares. After the transaction, GLIL will own 33.3% of the holding company and Virgin Media O2 the remaining 66.7%. As the majority shareholder of the holding company, Virgin Media O2 said it will continue co-controlling Cornerstone, together with Vantage Towers.

Cornerstone is the U.K.’s largest mobile towers business, consisting of a nationwide network used by both Virgin Media O2 and Vodafone UK as anchor tenants. The company owns and manages around 20,000 sites spread across both urban and rural locations in the U.K.

The telco highlighted that Cornerstone will remain a critical supplier to Virgin Media O2, and this transaction will not impact the existing commercial network sharing agreement between Vodafone UK and Virgin Media O2.

Virgin Mobile O2 also noted that the transaction is expected to close in the coming weeks.

Lutz Schüler, CEO of Virgin Media O2, said: “Selling a minority stake in Cornerstone is a logical move for us. We are partially monetizing our tower infrastructure, while retaining operational and strategic co-control in a key asset as we roll out 5G to more of the country and boost 4G connectivity. This deal aligns perfectly with our core infrastructure and capital allocation strategy which sees Virgin Media O2 continue to invest in the U.K. to expand and upgrade our next generation fixed and mobile footprints.”

Cornerstone was established in 2012 as a mobile network joint venture between Telefónica UK (now Virgin Media O2) and Vodafone UK. Since then, Vodafone transferred its 50% stake to Vantage Towers in 2021.

Virgin Media O2’s 5G network reached 1,600 towns and cities across the country as of the end of last year. The telco previously said it was on track to deliver 5G services to 50% of the U.K. population during 2023.

Virgin Media O2 had launched services in June 2021 as a joint venture between Liberty Global and Telefónica in the U.K.