Monthly News Roundup: July 2024

Helios Towers has revised its medium term strategy away from a 22,000 tower ownership target, towards growing its tenancy ratio to 2.2x by 2026. The towerco sites a smaller pipeline of potential acquisition targets today and a higher cost of capital as key drivers of the reviewed M&A strategy. The towerco has nearly doubled its footprint from 7,000 - 14,000 towers and nearly doubled its market presence from 9 - 14 over the last few years. The move implies a renewed focus on its operations and commercial relations in its existing markets.

Rural network-as-a-service provider NuRAN has announced a financial close of a US$5mn loan facility with the Facility for Energy Inclusion, a fund managed by Cygnum Capital. The initial drawdown of US$2.5mn is underway, with US$1.07mn for renewable energy asset refinancing in Cameroon, as well as the allow the firm to finish the deployment of 122 contracted sites. A drawdown for the DRC is expected to follow which will fund the completion of over 100 sites, with operations in the Ivory Coast and South Sudan expecting to begin before the end of 2024 subject to further financing. MTN has also increased its pipeline of rural sites with NuRAN, adding 200 2G, 3G and 4G sites in Benin, upping the partnership between the two to covering 8 markets in Africa.

Southern Africa has been hit with critical power outages after a drought exposed the region’s reliance on hydroelectric power. TowerXchange previously covered this impact in neighbouring Zambia, which has in turn recall 100 MWs of electricity from the export market, weakening the grid of Namibia and other Southern African states. Namibian communications service providers have been reporting significant interruptions due to limited electricity supply with both MNOs MTC and Telecom Namibia seeing disruption.

Nigerian satellite communication infrastructure company NIGCOMSAT has entered into a partnership with local towerco and rural connectivity provider Hotspot Network to deploy satellite technology and innovative connectivity to remote and rural areas. The initiative plans to roll out the first phase of the project over the next 6 months.

Finnish Development Finance Institution (DFI) has announced a US$5mn mezzanine loan to Communication and Renewable Energy Infrastructure (CREI), the investment and ESCO arm of global Managed Service Provider (MSP) ieng Group. The investment is to support the installation, operation, and maintenance of 413 hybrid power solution for telecom towers in South Sudan.

Valtter Louhivouri, head of Finnfund’s Nairobi office, commented “I can’t think of a better project to kick off the Africa Connected programme and Finnfund’s path as an implementing partner of the EFSD+ Guarantees”

The World Bank has pledged US$100mn to fund a new project to develop Zambia’s digital infrastructure and narrow the digital divide. The Digital Zambia Acceleration Project (DZAP) will increase access to internet and digital services, with a focus on broadband and last mile infrastructure. The project still needs approval from the World Bank Board, and if so will be financed via a combination of national and regional International Development Association (IDA) funds plus US$20mn in unguaranteed commercial financing. Ahead of this, the World Bank is also planning a Project Preparation Advance of US$5mn to finance activities during the preparation phase.

Indonesia’s Telecommunications and Information Accessibility Agency (BAKTI) says it aims to complete the construction of 630 base transceiver stations (BTS) in “unforeseeable areas” by the end of 2024. Antara, Indonesia’s news agency reports that BAKTI has collaborated with key stakeholders such as the Indonesian Armed Forces (TNI) and the National Police (Polri), to ensure the security and smooth development of BTS in these areas. Yulis Widyo Marfia, acting director for telecommunications and information services at BAKTI said that BTS construction in unforeseeable areas posed significant challenges. She says the security and geographic conditions in eastern Indonesia, particularly Papua, as the main challenges in completing work on these areas. These areas often have inhospitable geographical conditions that make them inaccessible, coupled with a low level of security, posing hurdles for partners to conduct development.

JTOWER has formed a new deal with MNO NTT DOCOMO to replace their existing networks with indoor infra-sharing.

The introduction of replacement will lead to lower CAPEX and OPEX for network installation for the MNO. Through the shared infrastructure, JTOWER will be able to reduce the amount of greenhouse gases by 65% - in the circumstance that ach MNO independently installed their indoor networks - by reducing the power consumption amongst other factors.

NTT DOCOMO had previously been deploying JTOWER’s in-building solution in many buildings, having originally installed .their own networks prior to partnering with them. However, as new buildings and improved spectrum has developed over time, IBS infrastructure has had to change as a consequence.

Malaysian telecom operator U Mobile has signed multiple agreements with towercos in the country in a bid to build Malaysia’s second 5G network.

U Mobile signed agreements with EDOTCO, Bullish Aim, EdgePoint Infrastructure, Naza Communications and OCK Group.

It says the agreements come in a move to expand 5G infrastructure and be at the forefront to rollout of the second 5G network in the country.

U Mobile will also discuss commercial models for infrastructure such as build-to-suit telecom tower sites, co-location on existing infrastructure and upgrades to existing sites.

Malaysia has taken a unique approach to 5G, first building a shared wholesale network, known as DNB, which all but one mobile network operator has taken a 16.5% stake in. Telekom Malaysia remains the only MNO to not take a share.

Globe Telecom has finalised the sale of a last batch of telecommunications tower assets to Frontier Tower Associates Philippines.

The eighth and final closing for 1,037 towers for approximately P13.17bn last week, according to the Philippine Stock Exchange. The latest finalised deal means it has turned over all 3,529 towers bought by Frontier Towers, wrapping up a P45bn (US$57.82bn) sale signed in 2022.

This brought the telco "closer to completing our entire landmark tower deal this year," Globe Chief Finance Officer Rizza Maniego-Eal said.

"This transaction provides us with a higher level of financial flexibility to manage our leverage ratios and effectively address the evolving consumer demands while ensuring sustainable network expansion," she added.

Globe has been selling tower portfolios to Frontier Tower Associates Philippines, Unity Digital Infrastructure, Phil-Tower Consortium, and MIESCOR Infrastructure Development Corporation.

Nokia and Telecom Egypt are partnering to launch Egypt’s first 5G network in cities including Alexandria, Aswan, Cairo, Giza, and Luxor. Nokia will provide its AirScale portfolio for faster data speeds and improved performance. Deployment is set for later this year.

Nokia will supply 5G RAN equipment with its energy-efficient ReefShark technology, offering extensive capacity and coverage. The project includes professional services for deployment and network optimisation.

5G technology will enhance connectivity, supporting faster downloads and improved network performance. Telecom Egypt secured the country’s first 5G license in January, valid for 15 years.

Ooredoo Kuwait has appointed Issa Haidar as Chief Technology Officer, effective immediately. Haidar, who has been with the company since 2005, will lead Ooredoo Kuwait's technology strategy.

With nearly 19 years in telecommunications, Haidar has a strong background in network and data analysis, including successful projects like the Mubarakiya Smart City and 5G deployment. He holds a B.S. in Electrical Engineering and an MBA, with training from top institutions.

Haidar plans to continue advancing Ooredoo Kuwait’s technological capabilities, particularly in network optimisation and new technology implementation. His strategy includes enhancing existing infrastructure, spearheading the rollout of emerging technologies, and driving energy-efficient solutions. He will also focus on strengthening the company’s position as a leader in innovation and ensuring that Ooredoo Kuwait remains at the forefront of the industry.

Ericsson announced that Jordanian telco Umniah will use its AI and machine learning solutions to reduce energy consumption in network operations after a successful proof-of-concept (PoC).

The PoC tested Ericsson's Intelligent RAN Power Saving solution, which uses a machine learning model to analyze real-time network data and optimize energy usage by managing network components.

Ericsson reported a 20% reduction in 5G daily power usage during the PoC. Umniah's CTO, Alaa Ibrahim, confirmed plans for full-scale implementation.

This follows a previous AI-related deal in March for Ericsson’s Cognitive Software AI solutions and a May agreement to expand Umniah's 3G and 4G networks in Jordan.

Oman Towers has announced a diversification of its income through a partnership agreement signed with with Mubasher Digital Advertising Company. The agreement allows Mubasher Digital Advertising Company to benefit from the digital screens that have been installed in the Mosaic towers owned by Oman Tower Company.

Vodafone has sold an additional 10% stake in Oak Holdings, the consortium that controls its pan-European towerco Vantage Towers for EUR1.3bn (US$1.4bn). Through the transaction, Vodafone has achieved a 50:50 joint ownership structure which was envisaged when the co-control partnership was first announced in end 2022.

Vodafone will use the amount it will receive from the equity stake to the consortium for deleveraging and will reduce its adjusted EBIDTAaL by 0.1x, in line with Vodafone’s target. The equity sale values shares at EUR32 (US$34.7) each which is the same price it received in November 2022.

Oak Holdings which includes private investors KKR and Global Infrastructure Partners (GIP) owns 89.3% of Vantage Towers and Vodafone’s ownership is 44.7% following the recent transaction.

Digi Communications, the parent company of MVNO Digi Spain, has announced the latter has signed a national roaming contract and a network and spectrum sharing contract with Telefónica for a period of 16 years, starting from 1 January 2025. In addition to national roaming, Telefónica will also give Digi access to more 3.5 GHz spectrum. The agreements replace an existing MVNO deal between Digi and Telefónica.

Digi Spain is the largest MVNO in the country in terms of customer numbers. The contracts will enable Digi to transition from an MVNO to an MNO and become the fourth operator on the market, restoring the balance which has changed since the MasMovil and Orange (MasOrange) merger.

The rise of Digi to an MNO has also been enabled by the earlier purchase of spectrum licenses provided by MasMovil to Digi in end 2023 as part of the merger remedies.

Neutral host Boldyn Networks has announced it will launch a private 5G network-enabled Innovation Lab in the Port of Blyth in northeastern England. Funded by over half a million-pound sterling (EUR593,000) investment by the North East Combined Authority, the lab aims to create a testing ground and dynamic environment for different businesses to develop and test 5G-based products. The facility’s launch is planned for September 2024, and it will also contribute to the development of 5G-based solutions for the offshore energy sector in the UK.

Local educational institutions, including Bede College and Advance Northumberland, will also benefit, by integrating a more digitally skilled curriculum for their STEM students and industry-specific training.

Cellnex UK has signed a long-term agreement to provide tower infrastructure and associated services to the two of the UK’s operators - Vodafone UK and Virgin Media O2. It will enable the efficient sharing of Cellnex’s tower infrastructure as well as roll out of wireless connectivity throughout the UK. The towerco already provides infrastructure to the two mobile operators and the new agreement ensures that the MNOs continue to have access to Cellnex's infrastructure across the UK. It also facilitates Vodafone and Virgin Media O2’s network sharing under their separate network sharing agreement.

Earlier in July, the two operators announced a new longer-term network sharing agreement that extends the current agreement between Vodafone UK and VMO2 for more than a decade.

The agreement aims to provide a stable basis for the future enlarged network of Vodafone UK and Three UK (MergeCo), with the merger being subject to the approval by the UK’s Competition and Markets Authority (CMA). In addition, VMO2 will acquire spectrum from the MergeCo.

Millicom's board committee advised shareholders to reject Xavier Niel’s Atlas Investissement's $4 billion buyout offer, stating it undervalues the company.

In a July 15 filing, the committee said the $24 per share offer ignores Millicom's long-term growth plans and financial targets, including projected equity free cash flows of $659 million in 2024, $701 million in 2025, and $833 million in 2026.

Brazil Infrastructure Company (BIC), a newly established firm specialising in designing and constructing bespoke digital assets, aims to address the connectivity gap across Brazil. While major telecom operators such as Vivo, TIM, and Claro are advancing network infrastructure in urban areas, BIC’s mission is to extend connectivity to suburban and rural regions, ensuring that all communities benefit from modern communication technologies.

The company is led by a seasoned team: Javier Rodríguez García as Founder & CEO, Antonio Alvarez Modrono as Founder & CTO, and Alex Sepehri-Nik as Founder & President. Rodríguez García, recognised as a pioneer in Brazil’s telecommunications sector, brings over 26 years of experience. His previous roles include significant contributions at Telefónica Brasil (Vivo) in the development of 2G, 3G, and 4G networks, and serving as Chairman of the Board of Advisors at Brazilian Tower Company.

Millicom and Telefonica are exploring a potential merger of their Colombian operations, Coltel and TigoUne. Millicom plans to acquire Telefonica's stake in Coltel for US$400mn and may purchase additional interests from minority shareholders. The proposed US$1bn investment aims to create a stronger telecom entity in Colombia by forming a second large-scale operator capable of significant network investments. This follows a network sharing deal announced last year. The deal, subject to negotiations and approvals, could reshape Colombia's telecom landscape and could lead to significant headwinds for Colombia's towercos.

Gilat Satellite Networks has received a six-year order worth over $10 million from Internet Para Todos (IPT) to provide cellular backhaul services in rural Peru.

IPT, a collaboration between Telefónica, Meta, IDB Invest, and the Development Bank of Latin America and the Caribbean, aims to bridge the digital divide in Latin America. Gilat will enhance its 4G backhaul services at 700 existing sites and 100 new sites in the Peruvian jungle.

This expansion will bring high-speed connectivity to over one million people in rural areas. The partnership between IPT and Gilat has been ongoing, with previous expansions reported in August 2022.