Paradigm Infrastructure signed its first SLB in 2021 alongside SBA Communications, Airtel Tanzania agreed to sell 1,400 towers to the new consortium for US$175mn. But who is behind Paradigm Infrastructure, and what impact will they have on the African telecom tower industry? SBA Communications is one of the leading towercos of the Americas and Tanzania will be its 15th market globally and second in Africa. Paradigm Infrastructure is a new towerco backed by ex-ATC EMEA executives and this is their first deal. TowerXchange speaks with Steve Harris, CEO of Paradigm Infrastructure about their origins and plans for the future.
TowerXchange: Congratulations on your deal in Tanzania, please introduce yourself and the team behind Paradigm Infrastructure.
Steve Harris, CEO, Paradigm Infrastructure:
Thanks. Paradigm Infrastructure was formed in 2019 by myself, Steven Marshall and Hal Hess, all past senior executives and industry veterans from American Tower Corporation (ATC). Between the three of us we previously held responsibility for all ATC operation’s globally, except for India. We have created a strong leadership team who have extensive exposure in developing and operating shared wireless infrastructure in emerging markets. Our team continues to grow. I am delighted to say most recently Gordon Porter joined our team as our Chief Operating Officer. Gordon has great industry experience in both Europe and Africa, gained from his time at Crown Castle, National Grid, ATC and IHS Towers.
TowerXchange: Can you share some of your past success stories from your experience in Africa?
Steve Harris, CEO, Paradigm Infrastructure:
When I joined ATC in 2008, I was employee number 2 in the EMEA region. For ATC my team and I were responsible for the company’s first move into Africa. Personally, I drove the acquisitions and operations in South Africa, Ghana, Uganda, Nigeria, Germany and France. Growing the business from zero to a significant business with excess of 15,000 towers.
TowerXchange: Why have you chosen to invest in Tanzania as your first investment as a group?
Steve Harris, CEO, Paradigm Infrastructure:
It’s a market I know well from previous investment discussions. It represents one of the few remaining markets in sub-Saharan Africa where a leading MNO was yet to divest its towers. Tanzania has strong forecast demand in growth of data traffic and a very strong operator base. Through our joint venture with SBA Communications Corporation (SBA), once closed, we expect to invest significantly in improving and expanding the portfolio. In addition, the strong relationship with Airtel makes this a great market opportunity.
TowerXchange: For Paradigm Infrastructure, what drove the desire for a partnership between yourselves and SBA in Tanzania?
Steve Harris, CEO, Paradigm Infrastructure:
SBA are an incredibly successful company in the tower industry with a most impressive pedigree. For Paradigm, having a partner like SBA makes real sense. Without sounding arrogant, our team has a wealth of proven experience in acquiring tower assets and setting up tower operations in emerging markets, where management of power, SLAs and site security are key success factors. SBA brings oversight, systems, people and financial capacity to help make this potential acquisition a real success.
TowerXchange: What are your expansion plans in Africa – will you be relying on sale and lease backs, or will you be expanding into other African markets through build-to-suit?
Steve Harris, CEO, Paradigm Infrastructure:
It will likely be a mix of both. Decisions and timing of sale and lease back transactions are, in the most part, determined by sellers, so its difficult to set a strategy that focusses purely on this. BTS opportunities will likely be our key focus, but we will be opportunistic when it comes to sale and lease back. There are still lots of opportunities to acquire existing portfolios.
TowerXchange: Why do you think there is space in Africa for new build-to-suit towercos in Africa?
Steve Harris, CEO, Paradigm Infrastructure:
Many markets have limited towerco providers, and I believe MNOs want and deserve to have a choice and a competitive market. This environment helps developing business like ours where customers are willing to support new market entry to help establish this competitive landscape.
TowerXchange: Do you think the SLB pipeline is drying up in Africa or will new operators in new markets bring towers to market on attractive terms?
Steve Harris, CEO, Paradigm Infrastructure:
Since 2010 you have seen a major move by MNOs in Africa to divest of their tower infrastructure, for financial or strategic reasons. And following on from this you have seen consolidation of towercos. I think there are still opportunities but less today. If you look at North Africa it is largely untapped. Whether these are on attractive terms really depends on the perspective of the buyer and their approach to valuation.
TowerXchange: How do you think the trend for MNOs to carve-out and commercialise towers on their own terms – think STC and TAWAL, Vodafone and Vantage Towers or America Movil and its new spinoffs – will affect the global telecom tower market?
Steve Harris, CEO, Paradigm Infrastructure:
I could write a thesis on this, but I guess you want a shorter answer. The incentive for an MNO to carve out their towers is clear. It’s an effective way of releasing capital and / or ensuring that investors attribute full value to infrastructure, which typically trades at multiples 3 or 4 times higher than MNO stock. How much the global tower market will be impacted depends on the residual ownership / control the MNOs retain in the entities that are created and whether these newly formed companies are allowed to expand and compete to their full potential. There are many different models that may be adopted but this is an exciting space for sure.
TowerXchange: Although this will vary market to market, how would you characterise your energy investment strategies?
Steve Harris, CEO, Paradigm Infrastructure:
Paradigm’s operational and energy focus is very much site focused. The first steps are always working closely with the existing, and often legacy, maintenance teams – they can point to some very simple, and often very economic, steps that can improve both performance and availability – and usually reducing the reliance on diesel. Subsequent steps are usually data driven. Referring back to Tanzania, core to our energy and operational strategy leads with the deployment of an industry leading site remote monitoring site solution, and associated business intelligence and data analysis tools. This will lead the team to make appropriate energy investment solutions, whether this be connecting currently unconnected sites to the grid (with data we can establish the likely available grid uptime that will be delivered, and also what solution will suit the individual site).
The overarching emerging strategy is obviously to reduce reliance on diesel as either a primary, or even secondary, energy source. The data will drive whether solar / lithium-based hybrid solutions are going to suit.
TowerXchange: Some multi-tenant sites in Africa are now home to three operators with each running 2G, 3G and 4G equipment leading to high wind loads and high power loads; what are your plans to service such demanding sites?
Steve Harris, CEO, Paradigm Infrastructure:
Sites with three operators running three technologies are good problems to have! We will be following industry protocols for structural analysis and employing value engineered upgrade solutions for both tower strengthening and any foundation upgrades necessary to accommodate the physical loads. As we have discussed, the approach to energy provisioning is very much data driven. Also, and in conjunction with the operators – we often provision the energy solutions for appropriate demand, rather than OEM specified peak loads, as these are generally not achieved for rural sites.
Also, we are excited about the developments with OpenRAN technology, and the impact this can have in the rural areas, often making connectivity available when previously not economically viable. And one of the key elements for such technologies is the appropriate provisioning of the power systems, a key strength for us.
TowerXchange: Where would you like to see Paradigm Infrastructure standing in five years’ time?
Steve Harris, CEO, Paradigm Infrastructure:
A leading emerging market focussed towerco, a partner of choice to the operators, providing high value solutions to multiple operators in several markets. Leading the way in a green agenda with high service levels.
