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Etisalat, MTN, Others Sell U.S.$3 Billion Telecom Towers [Sun, The (Nigeria)](Sun, The (Nigeria) Via Acquire Media NewsEdge) (ABUJA) Leading Nigerian and African mobile telecom operators, including MTN, Airtel and Etisalat are selling off over 30,000 base transceiver stations (BTS) tower assets in a move that signals adoption of a new business model predicated on cutting operational costs to shore up the average revenue per user (ARPU) from voice subscription to independent tower management companies. Investigation by LEADERSHIP confirmed that Africa’s mobile telecommunications revolution a decade and half ago saw mobile network operators (MNOs) build their own infrastructure from scratch. “Operators spent millions of dollars establishing passive mobile infrastructure which included tower sites and all infrastructure on them, such as, shelters and power and cooling facilities (excluding radio equipment). Today MNOs who were afraid that their competitors could eavesdrop on their communication lines if they shared infrastructure are now doing co-location of facilities and infrastructure sharing on the same site. Carriers in Africa are offloading the assets, which cost more to run on the continent than in other parts of the world because of the need for backup generators and batteries to guard against power failure. In the words of Messrs. James Cotter and George Morris of Simmons & Simmons LLP, such sharing is recognised by most governments and regulators as an important facilitator of competition at operator level, improvements to national network coverage (with resulting social and economic benefits)and reducing environmental impact For instance, he explained passive infrastructure sharing in Africa offered the prospect of opening up many markets to operators who would not otherwise contemplate building out their own infrastructure; extending existing operators’ services and stimulating network build in locations without coverage. Sale and ‘leaseback’ of passive infrastructure could make a great deal of sense financially, generating a cash windfall and replacing burdensome capital expenditure (capex) with regular and lower operating expenditure (opex. LEADERSHIP gathered that African operators such as MTN, Bharti Airtel, Orange, Vodacom, Egypt’s Mobinil are working on selling mobile tower networks in Africa, the latest examples of telecom operators looking to reduce exposure to costly infrastructure in the region. In Africa, towers and the infrastructure could account for more than 60 percent of the expense to build a mobile network, according to data from tower company, IHS Holding Ltd. MTN Group is on the verge of selling towers valued at $1 billion in Nigeria, and Bharti Airtel Africa is selling about 15,000 of its towers across 17 countries for $2bn- $2.5bn. Orange, France’s largest phone company is looking at disposing of towers in sub-Saharan Africa and Egypt. According to TMT Finance, a shortlist of three bidders had reportedly been drawn up for MobiNil’s 2,500-3,000 Egyptian towers.* Meanwhile, another operator in which Orange owns a stake, Sonatel, is progressing with the sale of 3,000 towers across Senegal, Mali, Guinea Bissau and Guinea Conakry. South Africa’s Vodacom has to date, sold 1, 149 mobile network towers to Helios Towers Africa in Tanzania. Bharti’s sale is likely to result in a split of the towers between multiple buyers. IHS, American Tower Corp. (AMT), units of Helios Towers and Eaton Towers Ltd are bidding for the acquisitions of the MTN and Bharti assets. These companies, backed by cash from wealthy investors including billionaire George Soros and Goldman Sachs Group Inc., have bought thousands of towers from carriers in the region in the past two years. In December 2013, MTN announced it had its tower portfolios in Rwanda and Zambia to IHS Holding Limited. MTN sold a total of 1,228 mobile network towers to IHS’s subsidiaries in Rwanda and Zambia, comprised of 524 and 704 towers respectively, for undisclosed amounts. The deal was in line with MTN’s asset optimization strategy and built on two previous deals with HIS in Cameroon and Côté d’Ivoire, for a total of 1,758 towers. Under the agreements, IHS would acquire and operate the towers and related passive infrastructure and would invest in a build-to-suit programmes to support MTN’s future requirements in both countries. MTN Rwanda and MTN Zambia will become the respective anchor tenants on the towers for an initial term of ten years. The two transactions brought the total number of towers in IHS’s portfolio to 10,500 extending its leadership in the African market as at then. It is believed that Barti Airtel and Etisalat are to sell towers valued $500m and $400m respectively. “The Value of Intellectual Capital is the ability to breed ideas that ignite innovation” Anonymous. (All Africa) The post Etisalat, MTN, Others Sell U.S.$3 Billion Telecom Towers appeared first on The Sun News. (c) 2014 The Sun Publishing Limited. All Rights Reserved. Provided by SyndiGate Media Inc. (Syndigate.info). |