What's hot in the Middle East’s largest telecom tower markets?
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What's hot in the Middle East’s largest telecom tower markets?


Don’t miss out on the region’s top three telecom markets

Between them they house over 85,000 towers, more than 30% of the region’s sites. Saudi Arabia, Pakistan and Egypt are all home to highly active telecom tower markets, with significant towerco processes in each market and significant new build already planned for 2021. These three markets alone will add 6,000 sites in 2021, marking them out as major targets for any supplier to the telecom tower industry.

Egypt is speaking with four international towercos about issuing a licence with a new build runway of 6,000 sites over six years. Pakistan added 2,000 sites last year and plans to add another 2,500 in 2021, as well as a purported sale and leaseback of Jazz’s 13,000 towers. In Saudi Arabia, huge infrastructure projects will require the construction of 1,000s of towers just as Zain and Mobily discuss carving out their towers into a joint venture or selling them to local towerco-giant TAWAL. Adding smaller markets like Oman, with a new entrant and new sale and leaseback process and you have a region with a a concentrated number of markets driving significant investment.

To build out your regional network and deepen your understanding of market dynamics, join TowerXchange’s Meetup MENA on 30-31 March. Take part in interactive roundtables and tune into panel discussions with industry leaders focussed around Saudi Arabia, Pakistan, Egypt and much more


The new towerco process is continuing in Egypt, with the strong likelihood that a new international independent towerco will begin operations in Egypt by Q2 2021. TowerXchange understands that four towercos are active in the process at present, namely IHS Towers, Helios Towers, TAWAL and Paradigm Infrastructure (the latter having formed a partnership with another large international towerco active in Africa). TowerXchange understands that American Tower has withdrawn from the process due to some certain conditions in the licence terms and local shareholding requirements.

Egypt has an active and large local telecom and engineering sector. Several years ago Egypt ran a licence process in which four local firms won licences and which resulted in 38 new towerco-owned sites being built. The government is keen to avoid a repeat and have three key planks to their strategy: international-backing, local ownership and coverage targets. The first is welcome, the two others have provoked some consternation.

The local 20% shareholding will be held by National Service Projects which is a large civil engineering company affiliated with the ministry of defence. The military has a large role in Egyptian society, politics and telecoms – for example, controlling access to frequencies. The logic from the Egyptian side is to include a powerful local stakeholder who can help open doors, build towers and manage local objections. The concern from independent towercos is the restrictions on their freedom of action.

The coverage targets built into the licence are both an opportunity and a concern. The concern comes from the questions raised over what would be the penalties for missing targets. The opportunity, and what is keeping at least four major towercos invested in the process, is the scale. Originally slated for 6,000 new towers over three years, the scale of construction would unlock 1000s of tenancies and offer a solid return on investment in a market with a sore deficit of towers. There are 4,199 SIMs per tower in Egypt, a worse ratio than Mozambique (3,198) or Namibia (3,767), and little better than Zimbabwe (4,398). Only Egypt’s high rate of tower sharing (30% of towers are shared) is enabling networks to cope.

The overall environment, therefore, is excellent for a prospective towerco. Unlike the rest of Africa, it now seems unlikely that ESCOs will enter the Egyptian market. Fuel subsidies and a concomitant lack of competitiveness for renewable energy means that ESCOs have failed to pass the POC stage with either Etisalat or Orange. Vodafone Egypt’s cancelled sale to stc is also bullish for new build prospects because Vodafone has recently become a major advocate of the towerco model.

Mobiserve and HOI remain the major contractors active in Egypt, but there are around 100 engineering firms who could help a towerco fulfil site build commitments. Demand for diesel generators, steel and towers would need to be met externally and would offer a strong medium-term source of orders for whichever supplier can secure operations in Egypt and the backing of the new licensee.

Tower ownership in Egypt


Pakistan remains one of the most interesting markets in the region with three conventional towercos present and smaller players experimenting with alternative models. In 2020 Pakistan added something like 2,000 sites nationwide. 2021 will see even more built. The grid is better in Pakistan than in many other countries in the region, but there is still a significant role for energy innovations in improving site availability and upgrading site resilience.

The country’s four MNOs are overlapping networks, with Jazz and Telenor more focused on urban areas and Ufone and Zong competing outside the country’s major hubs. PTCL, backed by Etisalat and the government could better utilise its sites and has just had its licence renewed for a further 25 years. Restrictions on available frequency has held back LTE rollouts but the government has now issued a plan to release more spectrum which will be bullish for new site builds.

Pakistan has been waiting on one major deal to close for some time, and evidence suggests that it could happen this year. Jazz has carved out over 13,000 towers into a captive towerco called Deodar. Previously, discussions for a sale and leaseback have included edotco and Enfrashare but they have not come to fruition. Recently IHS Towers were linked to the sale, but they appear to have pulled back. Nevertheless, the towers remain available for sale at the right price.

edotco, Enfrashare and Associated Technologies Limited (ATL) are the country’s three major towercos. A majority of new site build is now taking place through these towercos. Jazz is relying entirely on towercos for its site build out, Ufone sends almost all new sites to towercos and Zong is following a mixed strategy. The capex to revenue ratio in Pakistan would not support as many new sites as are required by mobile operators which is driving them to relay on towercos. Because of this, Enfrashare has added around 1,000 sites last year with a strong pipeline to continue this year. ATL likewise plan to reach 1,000 total towers by the end of the year and edotco will be adding many sites too.

Zong recently signed a 7,000 site management contract with i-eng which will ensure a major role for i-eng in Pakistan for years to come. While Pakistan is still finding its feet with regards to major sale and leasebacks, it remains a highly active telecom tower market with numerous opportunities. Pakistan’s tower market at the start and end of 2021

Tower Ownership in Pakistan


Saudi Arabia

Saudi Arabia is the Middle East’s largest telecoms market and home to the world’s 24th largest towerco: TAWAL. Following stc’s carve-out of TAWAL the question in Saudi Arabia has naturally turned to what happens to the towers of Zain and Mobily. In the past, the two operators have discussed a joint venture, talks which have allegedly reopened. Talks are also taking place about a sale or commercial arrangement between TAWAL, Zain and Mobily.

A number of factors are holding back a deal. There remains some hesitancy from Zain and Mobily about selling sites to an entity which remains owned by their principal rival, stc. There is also a lack of regulatory clarity in Saudi Arabia with a new rule in place which currently prevents the consolidation of more than 60% of the Kingdom’s towers under one owner. It appears to now be something of a political question whether Saudi Arabia will transition to a single towerco market under TAWAL or a dual towerco market through the creation of a new towerco.

The overall market for telecom towers and alternative typologies in Saudi Arabia remains large. Sites are continuing to be upgraded to hold additional technologies and new sites are required for some infill. New developments along the Red Sea coast, including at NEOM, a smart city project covering a land area equivalent to Belgium, will involve the construction of 1,000s of sites and will drive significant build to suit opportunities to TAWAL and any other partners active in the country.

Saudi Arabia’s tower market

Tower ownership in Saudi Arabia



Oman was one of the first countries in the Middle East to welcome independent towercos with the formation of Oman Tower Company in February 2018 by Oman 70 Holding Company, AktivCo (Camusat’s investment arm) and the Omani Government. Since then, the towerco has built and

acquired nearly 300 sites, but there has not been a major transaction in the market.

That may all change this year with a sale and leaseback transaction by Omantel for its 3,000 towers and rooftops. The rumoured price tag is north of US$500mn and three towercos have been linked to the sale. One of the bidders is comprised of Omani infrastructure fund Rakiza, which is backed by Oman’s sovereign wealth fund, which has partnered with IHS Towers. The second bidder is Oman Tower Company and the last is Helios Towers.

The market’s two current MNOs Omantel and Ooredoo are adding around 100-120 new towers each year. At present, 15% of towers are shared which indicates a culture of sharing, but one which is far from achieving its full potential. The real appeal of the market is the entrance of Vodafone-backed Oman Future Telecommunications as a third potential tenant. Network rollout and the potential for rapid lease up of any new and existing sites means that Oman will be a promising market who whichever towerco or towercos end up active in the market.

More to come

In Kuwait, IHS Towers has taken control of its first tranche of 1,020 towers with plans to begin rationalising the network and upgrading sites. Zain is also working with TASC Towers on a Data Park which will encompass investment in broader aspects of digital infrastructure than just towers. In Israel, mobile operators are now speaking with local towerco Tilbar about trial sale and leasebacks, which could open up the country’s 8,000 towers to international investment for the first time. Morocco, Algeria and Tunisia are all also seeing increasing pressure from regulators to improve 4G coverage which will require the construction of 1,000s of new towers, even if each country remains resistant to the towerco model.

The Middle East is not moving as quickly towards adoption of the towerco model as Europe, where the dam has undeniably broken. However, across the region, strong local economies and aggressive network plans from operators and governments mean that there is strong demand for new investment. Join sessions at TowerXchange’s Meetup MENA which will cover the markets of Saudi Arabia, Pakistan, Egypt and much more on March 30-31 2021 to learn more.

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