The opening months of 2024 has seen a continuation of the consolidation and M&A that ended 2023. Exciting transactions continue to reshape some Asian countries’ digital infrastructure climate. In February, PhilTower Consortium and MIDC announced plans to create a Philippine-wide digital infrastructure joint venture, which gained approval in September. The JV would be one of the first examples of towerco consolidation in the Philippines, a market with dozens of towercos active.
Earlier in January, Bangladeshi towerco Summit Towers snapped up just over 2,000 towers from VEON-owned Banglalink in a in a sale and leaseback deal worth $US100mn. However, shockwaves in the region were made over in Japan in August 2024, when sole independent towerco JTOWER accepted an offer from digital infrastructure investor DigitalBridge to acquire the company.
This period of relative market stability comes after a few years of a fast-paced M&A market in APAC, which only began to ease during 2023, albeit with some regionally impactful transactions witnessed during last year. Mitratel’s deal with IOH marked the end of an era in Indonesia. Following its close, 100% of the nation’s towers will be in the hands of independent or operator-led towercos. Meanwhile JTOWER successfully transferred the first batch of the NTT Docomo towers it purchased last year, marking the start of a new era in Japan. Over in the ever-changing Philippines market,
Unity and Frontier both completed their second sale and leaseback, meaning the two towercos have bought assets from both Smart and Globe. 2023 was also the year where towercos started acting on their plans to bring the next generation of mobile networks to the continent. Sustainability has moved up the agenda and there are nascent signs that towercos will soon be managing power in more markets across the region. This is leading to refreshed investment in equipment such as rectifiers, battery, gensets and solar solutions, with an emphasis on keeping both costs and emissions low. In the face of more and more severe weather conditions across the region, towercos are also looking to make sure they have robust backhaul and power solutions and a plan in place to restore connectivity at times when people need it the most.
2024 closes with activity continuing across Asia. February’s announcement that PhilTower was merging with MIDC was approved in September, and quickly followed with rumours that Macquarie was looking to monetise its stake in the company, possibly valuing the new entity at US$700mn to US$800mn. The creation of the JV has one of the first examples of towerco consolidation in The Philippines and is unlocking new investment the market.
Earlier in January, Bangladeshi towerco Summit Towers snapped up just over 2,000 towers from VEON-owned Banglalink in a in a sale and leaseback deal worth US$100mn. The telecom market there faced disruption following a coup, but new government ministers and regulators have been appointed and reassured investors.
Japan was a major focus for industry action for the first time. In August 2024, JTOWER accepted an acquisition offer from digital infrastructure investor DigitalBridge. The move has seen its MNO investors cash out and a new and well established international investor link up with the team that brought infrastructure sharing to Japan.
Of course, no summary would be complete without remarking on the turnaround in India. 2023 ended with Ascend Telecom consolidating Tower Vision, and we end the year with news that a consortia of international investors plan to invest in the towerco. The long-awaited completion of the sale of American Towers sites there to Brookfield ends a period of disruption. Vi is now even planning to roll out 5G in early 2025, a sign of a return to health from one of India’s most troubled operators.
In Malasia, the government has announced a second wholesale network will be created by U Mobile. Malaysia’s smallest mobile operator will be responsible for rolling out a competitive 5G open access network which should drive lease up for existing sites and potentially require U Mobile to bring its small stock of sites to market.
Elsewhere in Asia, smaller deals have also been reported, with Global Tower Corporation in Cambodia raising millions of dollars for rural rollout. But the attention of the industry now turns to two major growth areas.
Firstly, the transformation digital infrastructure networks is creating new opportunities for towercos to add value. To continue to merely provide traditional steel and grass services is no longer enough, energy, in-building, private networks and more are essential new services for towercos to serve their MNO customers.
And secondly, 600,000 telecom towers remain in MNO hands in just four markets: Japan, Vietnam, Thailand and India. How these sites come to market over the next few years will offer a major growth opportunity for the industry, if deals can be struck.
