(Bloomberg) -- Brookfield Asset Management Inc. has teamed up with DigitalBridge Group Inc. on a last-minute bid for a stake in Deutsche Telekom AG’s tower business, people with knowledge of the matter said. 

The Canadian investment giant tied up with DigitalBridge after its previous partner, Cellnex Telecom SA, dropped out of the race, according to the people. The new duo is seen as the current favorite to win the bidding, though no final decisions have been made, the people said. 

The consortium is competing with an investor group backed by KKR & Co., Global Infrastructure Partners and Stonepeak Partners. Deutsche Telekom could formally pick a winner as soon as Wednesday, the people said. The tower portfolio could be valued at around $20 billion in any deal, Bloomberg News has reported. 

Deliberations are ongoing, and Deutsche Telekom could also decide to keep the business, the people said. Representatives for Brookfield, DigitalBridge and Deutsche Telekom declined to comment, while a spokesperson for KKR couldn’t immediately comment. 

Fiber, Data Centers

DigitalBridge, which has a market value of about $2.9 billion, was pursuing its own bid for the tower unit earlier in the process and has now re-emerged with Brookfield, the people said. The company manages nearly $47 billion of assets solely focused on digital infrastructure such as wireless towers, data centers, fiber networks and edge infrastructure, according to its website. 

A consortium led by DigitalBridge agreed in May to buy US data-center operator Switch Inc. for about $8.4 billion. The company beat out rival suitors including Brookfield, people familiar with the matter said at the time.

Read more: Brookfield Chases Crisis Deals, Money and Offices in Europe 

Bloomberg News reported earlier this month that the KKR-backed group was emerging as the frontrunner to invest in Deutsche Telekom’s tower portfolio after submitting a more attractive proposal than the Brookfield-Cellnex consortium. This week, Cellnex announced it was no longer participating in the bidding. 

Vodafone Group Plc’s listed infrastructure arm Vantage Towers AG was also among suitors studying the business earlier, people with knowledge of the matter have said. 

Valuable Assets

The sale of a stake in Deutsche Telekom’s tower business is set to rank as one of the largest European infrastructure deals this year, according to data compiled by Bloomberg. 

Europe’s struggling phone carriers once saw ownership of these tower assets assets as a vital part of their business models. Now, under pressure to raise cash and cut the bill for new network investments, they’ve begun to spin off their wireless masts into separate units or sell them outright.

Institutional investors are drawn to such assets because of their ability to generate steady, long-term returns. KKR raised $17 billion for its latest global infrastructure fund earlier this year, while GIP is targeting $25 billion for what would be the world’s biggest pool of capital dedicated to infrastructure investments. 

(Updates with deal context, background on bidders from fifth paragraph.)

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