Monthly news round-up: September 2022

 

 

Africell Angola has reached the milestone of 5 million subscriptions in under 5 months of operations, having launched services in April this year. Although currently limited to Luanda, the MNO is expanding commercial network coverage ahead of a full-scale national rollout. Africell has built 200 sites in the capital so far with a total portfolio of 450 towers and is a tenant on both Unitel and ANTOSC sites. 

 

Safaricom Ethiopia has begun network rollout with a pilot in Dire Dawa City, eastern Ethiopia, meeting its latest deadline. An investment of US$1bn and a recruitment drive of 500 staff are supporting the rollout which will bring Safaricom services to 25 cities by April 2023. 

 

The World Bank’s IFC is investing US$160mn into Safaricom Ethiopia to support the operator’s network rollout in the country. The IFC will take a 15.5% stake in the company, with Safaricom Kenya holding 47.1%, Sumitomo 23%, the British International Investment holding 9.2%, and Vodacom holding 5.2%. This is welcome support for the operator whose nationwide roll-out plans have been hampered by civil war in the northern Tigray region which caused US International Development Finance Corporation put a US$500mn investment on hold last year. 

 

MTN Nigeria and Ericsson have announced the commercial launch of 5G technology in Lagos after MTN Nigeria started a 5G pilot for customers last month to test their latest mobile broadband technology. MTN was one of two operators, alongside Mafab Communications, to be awarded 5G spectrum after paying US$273.6mn during an auction last year. 

 

MTN is currently building private 5G networks for 14 companies in the mining and ports sectors in South Africa. These networks will support cloud computing, improved cybersecurity and have potential for IoT applications such as autonomous vehicles.  

 

Having first flagged plans to spin out a towerco back in 2020, Vodacom is now in the final stages of it’s legal process to complete the set-up of a carve-out in South Africa. Vodacom will retain full ownership in the towerco that will manage the operator’s 9,500 sites in the country, including both macro towers and rooftop sites. This makes up over half of their 14,635 mobile sites in the market.  

Although the operator would be open to options after the towercos creation, Vodacom confirmed they have no need to monetise the assets or raise capital. Michael Magambo, ex-CEO of American Tower Uganda, has been announced as the Managing Director to lead the towerco once finalised. Vodacom has indicated it could replicate the model in its other regional territories which include the DRC, Egypt, Ethiopia, Kenya, Lesotho, Mozambique, and Tanzania.  

 

Vodacom Tanzania has launched the country’s first 5G network, with aims to extent coverage to 230 locations although a timeframe has yet to be provided. This follows Vodacom’s commercial 5G service launch in South Africa in 2020 where they will bring their experience rolling out 5G networks to Tanzania. This comes after the Tanzanian telecom regulator TCRA called out market operators including Vodacom for subpar connectivity and demanded improvements be made to service quality, with another assessment due before the end of the year. 

 

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ENE.HUB and HUB design, manufacture, distribute, and manage smart street furniture, enabling the deployment of small cells and advanced smart city services. ATN said the intent of their acquisition was to bring the new towerco one step closer to achieving their vision of accelerating Australia's digital future. ATN also expressed intent to further expand beyond their existing tower and rooftop portfolio.  

 

After months of speculation, TowerXchange has learnt that AB Hightech - one of only four license holders permitted to build shareable towers in Bangladesh will soon be taken over by another towerco with operations elsewhere in Asia. AB Hightech were awarded their license alongside Summit TASC and Kirtonkhola Tower in November 2018, but legal disputes, local operating challenges and the Covid-19 pandemic have made growth slower than expected. 

 

Reliance Jio outlined plans to spend US$25 billion on 5G rollout in India and plans to launch services in major metro locations by the end of October. The major festival of Diwali (24th October) is also seen as a deadline for the first 5G offerings by Airtel, who plan to cover numerous cities across India by the end of the month. Both operators, who acquired enough spectrum to cover all 22 telecom circles earlier in the year, plan to provide nationwide coverage by December 2023.  

 

Newly merged Indosat Ooredoo Hutchinson (IOH) have announced they are plotting a sale of 1,800 towers. Local sources have stated that discussions are at an early stage, but IOH are looking to raise US$250m from a deal. Pre-merger, Ooredoo sold off the last of their 4,200 towers to EdgePoint Infrastructure, who have since consolidated their towers in Indonesia under their Centratama operating entity. Other local towercos likely to be interested in the bidding include incumbents Protelindo, Mitratel and Tower Bersama. Earlier this year edotco entered Indonesia with an acquisition of parent company Axiata’s portfolio, and American Tower also set up shop back in April. 

 

Bloomberg has reported that edotco is considering a partial share sale that could raise up to US$600mn. An adviser has reportedly been hired to begin investigating a process, but a decision on whether to proceed or not is yet to be made. In early 2021 edotco were planning a partial stake sale that was put on hold due to the Axiata subsidiary’s operations in Myanmar, which posed an investment risk following the military Junta’s coup in February last year. 

 

Following Norwegian outfit Telenor in an exit from the Myanmar mobile space, Qatari based Ooredoo have sold their business to Singapore based Nine Communications in a deal that has valued the MNO at US$576mn. The deal is subject to Myanmar regulatory approvals. Myanmar’s government required Lebanese M1 Group to partner with a local firm when they bought Telenor Myanmar.  

 

When Globe announced their tower sales to MIDC and Frontier in August, the Filipino MNO stated it was close to securing another deal for 1,350 towers with a separate towerco. At the end of September it was announced that Macquaire backed Philtower Consortium were that towerco - paying $US338 million for the sites and boosting their BTS portfolio to provide nationwide coverage.

 

Oman Tower Company report delivering 140 new sites in one month over August for a total of 970 telecom sites delivered to Omani mobile operators with an investment of over $60mn. These sites are presumed to be mostly for Vodafone Oman as Oman Tower Company is leading the operators network rollout.  

 

Jordan’s Telecommunication Regulatory Commission (TRC) has signed an agreement with operator Zain, having signed similar deals with Umniah and Orange last month, to pave the way for 5G rollout. The Jordanian government intends to establish 5G infrastructure to incentive the introduction of 5G services, with the telecoms sector having invested around US$2.62bn into infrastructure in the kingdom. 

 

Qatar-based MNO Ooredoo is considering a tower sale across its regional portfolio having announced a review of its tower strategy at Meetup MENA 2022 in March earlier this year. Much of the discussions remain closed-door, with talks ongoing and no certainty on what Ooredoo’s aims are. The operator has so far declined to comment on matters. Ooredoo have a large regional presence with operating subsidiaries in Qatar, Iraq, Oman, Kuwait, Tunisia, Algeria and Palestine and although a precise tower count is unknown, is assumed to have over 14,000 towers in MENA. 

 

 

 

Reports suggest that Vodafone has invited a number of investors to participate in an auction to acquire a stake in Vantage Towers. It is not yet clear what size stake Vodafone is looking to sell, with Vodafone currently holding an 82% stake in the towerco whose shares rose 4.2% following circulation of the news. Bidders reportedly having expressed interest include KKR, Global Infrastructure Partners and EQT 

 

In their 2022 Capital Markets Day, Telenor announced the formation of a new infrastructure business unit under which its towerco businesses, as well as fibre and datacentre assets will be held. Telenor established their Nordic tower businesses in 2021 incorporating 21,000 sites of which 16,000 are mobile (with most fixed sites set to be decommissioned). The company also owns a 50% stake in around 10,000 towers held in joint ventures and has begun to explore options for such assets. Speaking at the Capital Markets Day, Telenor laid out their goal to sell a minority stake in at least one of their tower businesses in the next 12-24 months.  

 

Brookfield, which owns a 45% stake in broadcast-telecom towerco, TDF has reportedly notified bidders that have progressed to the second round to acquire their stake in the towerco. Amongst the bidders who have moved to the next stage are EQT Infrastructure, Stonepeak and Tillman Infrastructure. Both TOTEM and American Tower have dropped out of the process, although the latter may reconsider should TDF’s other shareholders, APG and PSP Investments decide to exit their investments. Sources suggest TDF will be marketed at an enterprise value of around €8bn, equating to 19x EBITDA.  

 

French communications regulator, ARCEP (Autorite de Regulation des Communications Electroniques et des Poste) has agreed to allow the extension of the national roaming agreement between Free Mobile and Orange. The roaming agreement, which was signed in 2011, was set to expire at the end of this year and has been extended by a further three years until the end of 2025.  

 

Icelandic mobile network operator, Syn which operates under the Vodafone Iceland brand, has agreed the sale of its core network to open access infrastructure provider, Ljosleidarinn in a deal valued at US$21.1mn.  Syn had previously sold its tower portfolio to DigitalBridge’s ÍslandsTurnar. 

 

Cellnex Portugal and new market entrant, Digi, have signed a nationwide long-term agreement for the rollout of 2,000 PoPs before the end of 2023 as Digi rolls out its mobile network in the country  

 

 

Sitios Latinoamerica, the tower company spun off from América Móvil last month, seeks to initiate a share sale on 27 September. As per paperwork submitted to the Mexican Stock Exchange the company intends to list roughly 3.19 billion shares at a price of just MXN 1.57 million (USD 78,483). Further, América Móvil’s shareholders will receive one Sitios Latinoamerica share for every twenty América Móvil shares they own.

 

Sitios Latam’s towers will be available for access and use by all mobile operators in Argentina, Brazil, Chile, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Paraguay, Puerto Rico and Uruguay. The towerco has an initial inventory of 29,090 towers, 39% of which are in Brazil. 

 

AT&T Mexico has extended its 5G network coverage to ten new cities in the north of the country, namely: Tijuana, Mexicali, Ciudad Juarez, Mazatlan, Ciudad Obregon, Navojoa, Guasave, Ensenada, Puerto Penasco and Guamuchil. In addition, the cellco says it has boosted coverage in its launch markets of Mexico City, Guadalajara and Monterrey. The company has reiterated its plan to cover 25 cities by the end of 2022. 

 

Brazilian mobile operators TIM Brasil, Claro Brasil and Telefonica Brasil (Vivo) are attempting to secure a BRL 3.187 billion (US$609.7 million) discount on the price they agreed to pay for the mobile assets of cash-strapped telco Oi. While BRL1.447 billion has been retained in case of post-closing adjustments, the trio have argued that Oi must make good the difference and pay each of the acquisitive parties an additional fee. Oi’s mobile unit was sold at auction on 14 December 2020, generating a final bid of BRL16.5 billion. The deal was approved by the national regulators in Q1 2022. In April 2022 the adjusted closing price was calculated at BRL 15.922 billion. On its investor site, Oi published a statement of disagreement with the post-closing adjustment value by the purchasers. 

 

Brazil’s National Telecommunications Agency (Agencia Nacional de Telecomunicacoes, Anatel) has confirmed that the country’s national mobile operators are permitted to launch Standalone (SA) 5G services using the 3.5GHz frequency band in a further seven state capitals from 19 September. The latest locations to receive the green light are Aracaju (capital of Sergipe), Boa Vista (Roraima), Campo Grande (Mato Grosso do Sul), Cuiaba (Mato Grosso), Maceio (Alagoas), Sao Luis (Maranhao) and Teresina (Piaui). This follows similar decisions on three additional state capitals earlier in the month.

 

SA 5G services are being introduced on a rolling basis in Brazil, and are already live in 12 other state capitals, including Rio de Janeiro, Salvador and the capital Brasilia. Further updates are expected towards the end of October. 

 

Brazil’s National Telecommunications Agency (Agencia Nacional de Telecomunicacoes, Anatel) has terminated the authorisations for the use of the 450MHz band held by Oi (covering 5 states) and TIM Brasil (covering 4 states). Both licences were issued in 2012, with a view to providing rural coverage, but neither was ever used. 

 

Neko Servicos, which successfully bid on a regional 5G concession comprising a 1×200MHz block of 26GHz spectrum in Sao Paulo, only to withdraw its offer several months later – may face sanctions over its decision. TeleSintese quotes Anatel counsellor Vicente Aquino as saying: ‘In my view, the specific case under analysis is even more serious, since the lot acquired by Neko has the associated commitment to bring connectivity to public schools that do not have access to the internet.’ Post-auction, Neko was revealed to be a bidding vehicle for Yon Moreira, who runs MVNE Surf Telecom. The decision might have implications for any future 5G licence bidders in the region. 

 

Mobile newcomer Winity Telecom has enlisted Amdocs to support the rollout of its 4G and 5G networks across remote communities in Brazil. In the first phase of the project, Amdocs will assist Winity Telecom’s delivery of 4G connectivity to more than 600 small municipalities, including public schools, as well as covering over 35,000km of federal highways. The vendor has been awarded a six-year contract.

 

Winity Telecom, a holding company backed by alternative asset management firm Patria Investimentos, scooped up two blocks of 2×10MHz 700MHz spectrum in Brazil’s November 2021 5G spectrum auction. Winity paid BRL 1.428 billion – the highest bid for a single spectrum lot in the auction. The company plans to build 5,000 cell towers by 2029 and establish itself as Brazil’s first wholesale operator.