TowerXchange’s who’s who in MENA towers

Whilst 99% of towers in the MENA region sit in the hands of the MNOs, efforts around infrastructure sharing are continuing to build, towercos and tower joint ventures are being formed and tower sales have begun. At such a pivotal time, TowerXchange examines the key stakeholders currently active in, or with a potential appetite to join, the MENA tower industry.

Abraaj Investment Fund: UAE investment fund in the process of acquiring a stake in Tunisie Telecom from Emirates International Telecommunications. The stake sale may precipitate the divestment of towers from Tunisie Telecom

Abu Dhabi Investment Authority: Investment fund which had formed a consortium with KKR, Canada Pension Plan Investment Board and GIC Singapore to buy a stake in a merged Bharti Infratel and Indus Towers deal, valued at ~US$11bn (the deal since having fallen through). Currently has a preference for tower investments outside of the MENA region but that could change.

Acwa Group: Saudi conglomerate with an interest in towers. Joined forces with TASC Towers in their bid to acquire Zain’s Saudi Arabian sites

Africinvest: Tunisian headquartered private equity firm focussed on the African continent and rumoured to have an appetite for towers in the North African region

Aktivco: : ECSO owned by Camusat who owns 34% of Oman Towers Company – the first towerco in Oman.

Al Rahji Group: Saudi based investor which was linked with 2016 Mobily tower sale process (which was subsequently cancelled)

Al Zamil Group: Middle Eastern investor who was linked with previous tower sale processes in Saudi Arabia

Alkan: MEA tower manufacturer and system integrator which holds one of the four infraco licenses in Egypt to build and own towers in the country. The company is yet to retain any of the towers that it has built.

American Tower: The world’s largest independent commercial towerco with a global tower count approaching 150,000. Whilst American Tower do not currently have a presence in the MENA region, the towerco is highly acquisitive with a truly international footprint spanning the Americas, Europe, Africa and Asia. As a US listed company, their ability to enter some Middle Eastern markets may be challenging but where there is an interesting tower transaction of scale, American Tower is never very far away.

Asia Consultancy Group: </span Afghan managed service provider. Also owns ~100 Afghan towers available for co-location and RANsharing services.

Asiacell: Ooredoo’s opco in Iraq.

ASMA Capital: Bahrain headquartered Infrastructure fund managers with a known interest in the tower asset class

Batelco: Bahrain headquartered telecommunications company with mobile network operations in Bahrain and Jordan (where it operates under the Umniah brand) and a minority investments Yemeni operator, Sabafon. Batelco had previously explored the sale of its tower portfolios in Bahrain and Jordan to fund acquisitions. When the acquisitions fell through, so did Batelco’s appetite to sell towers.

Berkshire Partners: Berkshire backed Crown Castle during their successful foray into European towers in the late nineties, and currently has active investments in Protelindo (the largest towerco in Indonesia which had a small footprint in the Netherlands until their Dutch towers were sold to Cellnex in 2016), Torres Unidas (active in the Andean region of CALA) and Tower Development Corporation (active in the US and Puerto Rico). The investor may look at emerging opportunities in MENA.

Blackstone: Another serial towerco investor currently working with Phoenix Tower International in CALA. Should a sizeable towerco emerge in MENA, Blackstone may well assess the opportunity.

Brookfield Asset Management: Investor with an active interest in towers which owns a stake in French towerco TDF. Brookfield entered into discussions to acquire UK based Arqiva and also recently evaluated the Indian towerco, Reliance Communications. Brookfield has an appetite for further tower investments and has increasingly been looking at MENA.

BuyIn: 50/50 procurement joint venture between Deutsche Telekom and Orange, a key client for companies looking to sell into Orange’s MENA opcos.

Canada Pension Plan Investment Board: CPPIB is the professional investment management organisation that invests the funds of the Canada Pension Plan on behalf of its 20mn contributors and beneficiaries. CPP’s tower investments include a 10.3% stake in Bharti Infratel with KKR, bought at US$951.6mn. It was also part of a consortium led by KKR which was in talks to buy a significant stake in a combined Bharti Infratel and Indus Towers deal.

Capital Group: Investor keen on the towerco asset class with capital at work in Eaton Towers (who had expressed an interest in Egypt).

Citi: One of the world’s leading tower transaction advisory groups who have been involved in tower process in Saudi Arabia and Kuwait.

Communication Towers Company: Towerco subsidiary established by Saudi Telecom Company in Q1 2018 to take over responsibility for owning, constructing, operating, leasing and commercialising telecom towers for the operator. As of 1 December 2018, the entity is yet to commence commercial operations but activity is expected by early 2019.

Dawood Hercules Corporation (DH Corp): : LListed Pakistani investment conglomerate with a US$600mn market cap. Took a 45% stake in edotco Pakistan prior to the (now cancelled) deal to acquire 13,000 towers from Jazz.

Digital Colony/ Digital Bridge: An investment vehicle through which stakes are invested in towercos around the world. Has active investments in Mexico Tower Partners, Andean Tower Partners and Vertical Bridge and also sold Global Tower Partners (GTP) to American Tower in 2013 for $4.8bn. More recently, Digital Colony acquired Finnish towerco, Digita and invested in UK indoor mobile connectivity providers, Stratto and Opencell.. Digital Bridge had expressed an interest in the deal activity in Saudi Arabia.

Djezzy (Optimum Telecom Algerie/ OTA): AAlgerian MNO in which Russian owned VEON (formerly VimpelCom) has a 49% stake (with the remainder held by the Algerian government). VEON has sold their WIND towers in Italy to Cellnex and initiated (and since cancelled) tower sale processes in Russia, Pakistan and the CIS. The company had conducted an initial investigation of a potential tower sale in Algeria, but with limits on foreign investment in the country, there was insufficient interest from towercos. Should a willing buyer appear, Djezzy may well move forward with plans.

dU: The UAE’s number two MNO in which the government also has a stake.

Eaton Towers: Africa’s fourth largest towerco, with a portfolio of 5,300 sites across Burkina Faso, Ghana, Kenya, Niger and Uganda. In 2016, the towerco reached a deal with MobiNil (now Orange) to acquire 2,000 Egyptian towers (about one third of the operator’s total stock in the country) before the deal was cancelled. Eaton remain committed to the Egyptian market with CEO Terry Rhodes telling TowerXchange “Eaton Towers still regards Egypt as a market ready for independent tower companies. The imminent rollout of 4G, together with economic and political changes which have made US dollars very scarce mean the operators will be under financial and operational pressure to expand their networks. It would be enormously beneficial for this expansion into infrastructure”. The towerco has less of an appetite for the more developed Middle Eastern market, having shied away from participation in Zain’s tower sales in Kuwait and Saudi Arabia with the different dynamics not a good fit for their current portfolio and capabilities.

edotco Group: PPan-Asian towerco with a footprint of 28,490 towers across Malaysia, Sri Lanka, Bangladesh, Cambodia, Pakistan and Myanmar. In 2017, edotco acquired Towershare’s Pakistani business for US$90mn before linking up with Dawood Hercules Corporation in a now-cancelled deal to acquire 13,000 towers from MNO Jazz. Spun out of Malaysia’s Axiata, the MNO’s shareholding in edotco has been diluted to 62.4% following private placements by INCJ, Khazanah and KWAP. edotco has previously been linked with tower transactions in the Middle East and is understood to have an appetite for geographical expansion outside of its current markets.

EEC Group: Egyptian towerco manufacturer holding one of the country’s four infraco licenses that enable it to function as a towerco. EEC is yet to retain any of the towers it has built on its balance sheet.

Emirates International Telecommunications: Dubai Holding’s primary investment vehicle in telecoms; has a stake in UAE’s du, and Tunisia’s Tunisie Telecom. EIT is attempted to sell its stake in Tunisie Telecom to Abraaj Investment Fund in 2018, but this deal fell through.

Etisalat: UAE’s leading MNO with a presence in Saudi Arabia (Mobily), Egypt (Etisalat Misr), Pakistan (Ufone) and Afghanistan in addition to a 53% stake in Maroc Telecom (which itself has a presence in 15 African markets) and a presence in further Asian markets. The operator has experience of monetising tower portfolios, selling their Nigerian portfolio to IHS back in 2014 and 2015, although the lease payment challenges which compounded their financial woes prior to their exit in 2017 are understood to have deterred the MNO from any future tower divestments. In Saudi Arabia, Mobily had explored a potential tower sale as well as a potential joint venture with number one MNO, Saudi Telecom Company although both plans appear to have been put on hold for the time being. Meanwhile in Pakistan, Etisalat’s subsidiary, Ufone has also been exploring a tower sale for a while. edotco’s entry into Pakistan (through the acquisition of the Towershare towers), coupled with IHS’ potential entry into Saudi Arabia (should their acquisition of Zain’s towers go through) will once again expose Etisalat to working with independent towercos, something which may inform its strategy going forward. In North Africa, the MNO is investigating the ESCO model as an alternative outsourcing strategy, and given the operational complexities and high opex of operating in Afghanistan, remains keen on finding an ESCO partner there too.

Fanasia: Iranian Tower builder with experience of building over 400 sites. Became the first independent tower company in Iran and currently owns 106 sites having also been heavily involved in decommissioning programmes working closely with municipalities. The towerco more recently formed a new towerco venture with number one and number three MNOs in the country, MCI and Rightel (see Iranian Towers).

GIC: Investment firm which manages Singapore’s foreign reserves through investments in over 50 countries including a stake in IHS Towers. GIC’s interest in towers was further confirmed by their bid to acquire a stake in Telefonica’s Telxius and the firm had also been linked to tower transactions in the Middle East.

Global Tower: MNO Turkcell’s wholly owned infraco managing the company’s tower portfolios (totalling 10,211 sites) in Turkey, the Ukraine (via UkrTower), Belarus (BelTower) and Northern Cyprus. In 2016, Global Tower postponed their planned IPO at the eleventh hour. The company is known to have an appetite for tower portfolios outside Turkcell’s home markets, targeting Eastern Europe, the CIS and the Middle East.

Helios Towers: Africa’s third largest towerco with a portfolio of 6,560 towers split across Tanzania, the DRC, Ghana and Congo Brazzaville. The towerco has recently dropped the world “Africa” from its company name and has expressed an interest in markets outside of the African continent, suggesting that they may well have an interest in tower portfolios coming to market in MENA. The towerco has a strong grounding in operationally complex developing telecoms markets.

HOI-MEA: Egyptian managed service provider and tower manufacturer, possessing an infraco license in the country and owning a portfolio of 38 towers built for Vodafone and Etisalat. There had been speculation that HOI-MEA had been looking for a buyer of its tower portfolio.

IHS Towers: MEA’s largest independent towerco with a portfolio of 22,860 towers across Nigeria, Cameroon, Côte d’Ivoire, Rwanda and Zambia. The towerco has recently agreed the first tower transactions of scale in the Middle East, reaching an agreement to acquire Zain’s 1,700 Kuwaiti and 8,100 Saudi Arabian towers. The towerco is very much positioning itself to be a leader in the Middle Eastern market and one can expect IHS will have a strong interest in any future tower portfolios which come to market. Privately owned, IHS’ investors include MTN (with a 29% stake), Wendel and the IFC.

Infrashare: Newly established towerco focussed also on the North African market. Infrashare’s management team hails from LCC Algeria with their CEO formerly serving as CTO of one of the country’s leading MNOs.

International Finance Corporation (IFC): The IFC is a member of the World Bank Group, the world’s leading DFI. The IFC has invested around half a billion dollars in debt and equity in eight towercos across emerging markets and whilst some of the Middle East’s more developed markets might beyond the investor’s remit, expect the investor to have an active interest in more emerging countries.

iQ Networks: Iraqi carrier with the largest independent infrastructure portfolio in the country.

Iranian Towers: Towerco venture created between Iran’s number one and number three operators, MCI and Rightel, and towerco Fanasia. The towerco will manage all new site build for the two operators with plans to consolidate much of MCI and Rightel’s existing tower portfolios into the venture.

ISON Towers: Emerging market focussed towerco which recently obtained a towerco license in Bangladesh and has significant appetite for towers in MENA.

Jazz: Created from the merger of Warid and Mobilink (VEON) in early 2017, it is the largest MNO in Pakistan by subscribers. In late August, Jazz agreed the sale and leaseback of its 13,000+ towerco subsidiary, Deodar, to edotco, who partnered with local firm Dawood Hercules for the deal, valued at US$940mn. In October 2018, Jazz announced that the deal had been cancelled. Jazz’s portfolio was established over 20+ years of operations, featuring a balanced urban-rural mix, and mainly tracks with the population concentration of Pakistan along the Indus valley with greater concentration of sites in the Central region, followed by the South and Baluchistan and KPK and North regions. About 80% are ground-based as opposed to rooftop structures.

KKR: : Global investment firm that manages investments across multiple asset classes including private equity, real estate, credit strategies and hedge funds. KKR acquired a 40% stake in Telefonica’s infraco, Telxius, and in June 2018 acquired a 49% stake in Altice’s French SFR TowerCo as well as being linked with other tower processes including a merged Bharti Infratel and Indus Towers deal.

Korek Telecom: Iraq’s fastest growing MNO with a portfolio of over 3,500 sites. The MNO has significant network deployment plans following a turbulent time in the war torn country, with an almost doubling of its total tower stock required.

Macquarie Group: Serial towerco investors with capital at work in Arqiva, Russian Towers, Axicom and Mexico Tower Partners demonstrating their truly global interest in the asset class. The investor does not currently have a focus on the MENA region

Maroc Telecom: Morocco’s incumbent operator in which Etisalat has a 53% stake. The operator also has a strong West African presence through subsidiaries in nine African markets. The company remains conservative with regards to infrastructure sharing and has expressed little interest in divesting their towers to date (although rumours have surfaced of some early stage tower sale discussions by some of their West African opcos).

MCI: Iran’s largest MNO (and 15th largest operator globally) with a portfolio of 21,000 sites. Has formed a new towerco, Iranian Towers, with Iran’s number three MNO, Rightel and Iranian towerco, Fanasia.

MENA Towers: Early stage towerco with offices in the UAE, Cote d’Ivoire and Pakistan.

Mobily: Number two MNO in Saudi Arabia, in which Etisalat have a 27% stake. Had previously commenced a process to sell their portfolio of 9,600 towers before abandoning plans to focus on the formation of a tower joint venture with number one MNO, Saudi Telecom Company. Plans for a joint venture have since been scrapped. Plans for a joint venture have since been scrapped with STC forming establishing their own towerco subsidiary. Mobily is yet to confirm any plans for its own towers.

Mobiserve: Egyptian system integrator which holds an infraco license in Egypt. Yet to retain any towers on balance sheet.

MTN: Africa’s largest MNO which has monetised towers in seven of their 20 markets, forming joint venture towercos with American Tower in Ghana and Uganda, completing sale and leasebacks with IHS Towers in Cameroon, Rwanda, Zambia and forming a joint venture with the former in Nigeria (prior to restructuring its shareholding in the JV for additional shareholding in IHS group level). In the MENA region, MTN has a presence in Iran (via MTN Irancell) and Syria. MTN Irancell’s competitors MCI and Rightel have formed a new towerco, Iranian Towers, which MTN has opted to stay out of.

Mubadala: Abu Dhabi’s leading investment company which is active in 13 sectors and more than 30 countries around the world. Known interest in MENA towers.

NATIC (North Africa Telecom Infrastructure Company): North African towerco part of the Asel Telecom group.

New Silk Route: New Silk Route is a US$1.4bn private equity firm that invests in private companies in India, Asia and the Middle East. Its investments in the telecommunications infrastructure industry include Ascend Telecom in India.

A fast-growing MNO, ISP and fibre provider based in the Kurdistan region of Iraq.

Oman 70 Holding: Shareholder in newly formed Oman Towers Company.

Oman Towers Company: Newly formed towerco, first in Oman in which Oman 70 Holding company owns a 56%, Aktivco owns a 34% stake and the Omani government owns a 10% stake through Oman Broadband Company. Oman Towers Company plans to invest RO15mn (~US$39mn) in its first phase of activity, with plans to build 600 towers in the first five years. The towerco also has an appetite for the existing tower portfolios of the country’s two MNOs.

Omantel: Oman’s incumbent MNO, 51% owned by the government. Recently acquired a 21.9% stake in Zain in a bid to diversify its revenue sources and overcome the risks of being present in a single market. The operator owns approximately 2,900 ground based towers and 5,000 rooftop towers.

Ooredoo: Qatar headquartered operator with a presence in Algeria, Iraq, Kuwait, Palestine and Tunisia (as well as further afield in Myanmar and Indonesia where it has extensive experience of working with towercos). Infrastructure sharing by the MNO in MENA has been limited to date but is something that Ooredoo is keen to place additional focus on both in terms of passive and active sharing; active sharing agreements are understood to have been struck with Tunisie Telecom and Djezzy in Tunisia and Algeria respectively. Iraq represents the MNO’s most operationally challenging market where power concerns are particularly acute. Such dynamics make outsourcing to either ESCOs or a towerco particularly attractive.

Orange: Multinational MNO with a footprint in 29 countries across Europe and Africa; in MENA they have a footprint in Egypt, Jordan and Morocco (and non controlling interests in Tunisia and Iraq). The operator has monetised towers in three African markets and engaged in active sharing arrangements in Europe. In MENA, the operator had reached an agreement to divest a third of their Egyptian towers to Eaton Towers before the deal was cancelled. The operator has since issued an ESCO RFP in the country and appears to have limited interest in divesting any further tower portfolios.

Providence Equity: Communications infrastructure investment specialists with money at work in Indus Towers (India), Grupo Torresur (Brazil) and KIN (Indonesia). Providence had been linked with previous tower sale processes in Saudi Arabia although their appetite to invest in MENA appears to have cooled.

Quippo International: The former ownership team behind Viom Networks which was acquired by ATC India. Believed to have an appetite for opportunities in multiple markets.

Rightel: Iran’s third largest operator. Has joined forces with MNO MCI and towerco Fanasia to form a new towerco, Iranian Towers.

Sanabil: Saudi Arabian investor, which although wholly owned by the government’s Public Investment Fund, operates as an independent investment institution. Understood to have an interest in towers.

Saudi Telecom Company: Saudi’s leading MNO which also has a presence in Bahrain and Kuwait where it trades under the name VIVA. Saudi Telecom Company had explored the sale of its 16,400 Saudi towers before abandoning the sale to explore the formation of a joint venture with Mobily, a plan which was then put on hold. STC had commenced proceedings to form its own in house towerco, creating Communication Towers Company in Q1 2018 (although the entity is yet to commence commercial operations).

SBA Communications: Publicly listed towerco with a portfolio of over 25,000 towers across North and South America. The towerco has preferred to operate a “grass and steel” model, shying away from markets where power presents a challenge to towercos. The towerco had expressed an interest in MTN’s South African portfolio and may well have an appetite for major tower portfolios in the MENA region should they come to market.

Tanzanite: Towershare’s Pakistani business which had built a portfolio of 700 towers, mostly through acquisitions and with the majority coming from previous WiTribe assets. In June 2017, edotco agreed to purchase 100% of Tanzanite for US$90mn.

TAP Advisors: Boutique advisory firm with a long history of advising on tower deals.

TASC Towers: Towerco which had entered into exclusive negotiations to acquire Zain’s Saudi Arabian towers before the MNO abandoned talks in favour of negotiations with IHS and Towershare. TASC has developed a modest tower portfolio in Jordan.

Telecommunications Regulatory Authority of Bahrain (TRA): Bahrain regulator which introduced new legislation surrounding infrastructure sharing and tower rollout in the Kingdom at the start of 2018.

Telenor: Norway’s incumbent MNO with a presence in 29 countries including Pakistan. Telenor is a keen advocate of all forms of network sharing, sharing towers (primarily with Jazz), fibre (with Zong), and has taken a lead role in exploring active infrastructure sharing. Telenor and Zong undertook Pakistan’s first RANsharing trials across around 30 sites, while the Norwegian-owned MNO has also shared IBS, both under the MORAN model where spectrum is not shared.

Tillman Global Holdings: Investor with a broad appetite for towerco investments anywhere from early stage opportunities to sale and leasebacks in mature markets of thousands of sites. Led by Chairman and Co-Founder of Eaton Towers and ex-CEO of Orange, Sanjiv Ahuja.

Towershare: Dubai headquartered towerco which built a portfolio of 700 towers in Pakistan (mostly through acquisitions, with the majority of towers coming from previous WiTribe assets). In June 2017, edotco agreed the purchase of 100% of Towershare’s Pakistani business, Tanzanite, for US$90mn. In Kuwait, Towershare joined forces with IHS Towers reaching an agreement to acquire 1600 Zain towers, with Towershare since absorbed into IHS’ operations.

TPG Capital: Private equity firm with a known interest in towers. Has been linked to opportunities in the MENA region.

Ufone: Ufone is the mobile arm of the incumbent telecoms provider in Pakistan, PTCL, and is the fourth largest operator in the country by subscribers. Ufone has been exploring the potential sale and leaseback of its towers in Pakistan for some time. The process was stalled by the de facto merger of PTCL and Ufone, and associated management changes, but Ufone could yet contribute over 6,000 further assets to the pool of commercially shared towers in the country.

Vinson & Elkins: Law firm with significant expertise in the tower sector. Manages the Middle East from their Dubai office.

Vodafone: Multi-national MNO, Vodafone is an advocate of infrastructure sharing and has entered into passive infrastructure sharing JVs in the UK (CTIL) and Ireland (NetShare), as well as active infrastructure sharing deals in Greece, Romania, Spain and again in the UK. In September 2018, Vodafone’s new CEO, Nick Read, announced his intention to assess the sale of 55,000 of Vodafone’s European towers. Apart from Vodafone India’s participation in Indus Towers in India, a sale and leaseback deal in Tanzania through subsidiary Vodacom, and a manage with license to lease deal in Ghana, Vodafone has not yet entered into deep partnerships with towercos. In MENA, Vodafone has a presence in Egypt where the company has also agreement with new mobile market entrant, Telecom Egypt, to provide transmission and infrastructure services.

Wendel: Family fund which is a leading investor in IHS Towers.

Zain: OOperator which has agreed the sale of their 1,700 Kuwaiti sites and 8,100 Saudi Arabian sites to IHS Towers. The company also has operations in Iraq, Sudan, Bahrain and Jordan and could be a likely candidate to commence further tower sale proceedings, should the Kuwait and Saudi transactions prove positive.

Zong: Formerly knowns as CMPak, Zong is China Mobile’s Pakistan opco. It ranks third by subscribers and has around 9,100 sites, of which around 2,000 are co-locations.

Advance apologies: we’re bound to have missed one or two key stakeholders in Middle Eastern and North African towers – if so we’d like to know! If you feel your company should be profiled in the TowerXchange who’s who in MENA towers, please email Laura Graves, Managing Director, EMEA, TowerXchange, at: lgraves@towerxchange.com

TowerXchange will be bringing together the who’s who in MENA towers at the TowerXchange Meetup MENA, being held on 29-30 January 2018 at Le Meridien Hotel & Conference Centre, Dubai