Monthly news round-up: January 2022

Diyar Al Muharraq, a Bahraini real estate developer, has signed an MoU with Diyar Al Muharraq to construct and operate 13 telecoms towers in a new development just outside capital Manama. Bharain has been making a big effort to reduce parallel infrastructure, and as such the towers will be shared with Batelco and Zain, the other two operators present in the Kingdom. 

 

In November 2021 it was announced that South African Vodacom Group had reached an agreement to acquire 55% of Vodafone Egypt from parent company Vodafone Group (UK) in a deal estimated at US$2.7 billion. The transfer is pending approval from National Telecom Regulatory Authority of Egypt (NTRA), and has now been approved by Vodafone Egypt shareholders following an extraordinary general meeting (EGM) held on 18 January. 

 

Pan-Middle Eastern operator Zain has confirmed the first of three tower deals alluded to in their Q3 results, by agreeing a transaction with Dubai based TASC Towers worth US$88m for 2,607 towers. Zain has signed a 15-year lease back deal with TASC and has also transferred an additional 223 sites on a managed basis.  TASC will manage Zain Jordan’s supporting facilities such as power generators, fuel tanks and protection kiosks. The deal also includes a build-to-suit agreement allowing for a minimum of 525 network sites to be built over the next five years. 

 

Recent downtime for the internet in Lebanon has been addressed by Ogero, who claims it has secured enough fuel to maintain services for five months. An economic disaster mixed with government bureaucracy and squabbling over a probe into 2020’s port explosion has led to shortages across the country, and significant cost increases for all of the state's MNOs. It is anticipated that diesel costs will account for two thirds of opex in 2021, while the ability to import equipment from abroad has been eroded by currency values sharply falling 

 

Oman Future Telecommunications owned Vodafone Oman has begun operations, by offering 4G and 5G data services alongside SMS and voice. Ericsson will continue to deploy their Radio Access Network, while local player Oman Towerco will continue to support the country's third operator in building its network as it seeks to compete with Omantel and Ooredoo. 

 

Flanked by diamond sponsor TAWAL and gold sponsor IHS Towers, TowerXchange is well underway preparing for the return to an in-person Meetup MENA in Dubai (28-30th March)! With attendees also joining from Zain, Ooredoo, TASC, Helios Towers, Jazz, PTCL, Turkcell, Oman Towerco, Associated Technologies and many more – make sure you don’t miss out on meeting the who’s who in MENA towers. Find out more at https://meetup.towerxchange.com/mena 

 

 

 

 

Belgium’s Institute for Postal Services and Telecommunications has issued a call for tender for its hotly anticipated spectrum auction. The auction will not only issue 5G spectrum but also frequencies for 2G, 3G and 4G. Interesting, the auction includes a spectrum package reserved for a possible new market entrant. The new market entrant would compete with Proximus, Orange and Telenet in the market.  

 

Telia has completed the sale of a 49% stake in its Norwegian and Finnish tower businesses to Brookfield and Alecta. Infrastructure investor Brookfield and Sweden’s largest pension fund, Alecta have invested €767mn to acquire the stake, giving the tower business an enterprise valuation of €1.52bn. The closing of the deal adds a further tower business to Brookfield’s portfolio with Brookfield being an investor in TDF (France), Wireless Infrastructure Group (UK) and Summit Digitel (India). For Telia, the deal marks their first tower transaction although further processes are expected – read TowerXchange’s full analysis of the deal.

 

4iG has closed the acquisition of Digi Communications Hungarian business. In 2021, 4iG also reached an agreement to acquire state owned broadcast towerco, Antenna Hungaria. 

 

Iliad and Vodafone are reportedly in talks to merge their Italian business units, a move which would reduce the number of operators in the Italian market from four to three. Iliad’s entry into the Italian market came as a condition of the merger of Wind and 3 and any future mergers would need to be improved by the Italian and European competition commissions. Separately, rival MNO TIM has outlined a plan involving the separation of its infrastructure and retail assets as an alternative KKR's bid to take the operator private. The final plan is to be presented in early March. 

 

Cordiant Digital Infrastructure has reached a deal to acquire Polish broadcast infraco Emitel from Alinda Capital Partners for a total of US$477mn. Previously, Emitel had twice explored an IPO only for the process to be pulled. Cordiant Digital Infrastructure is headed by Steve Marshall who formerly served as President of American Tower. 

 

Portugal’s National Communications Authority (ANACOM) has approved Cellnex’ acquisition of 223 macro sites and 464 small cell sites from MEO for a total of €209mn. MEO had previously carved out c. 3,000 sites into OMTEL, initially selling a 75% stake to an investment consortium before Cellnex acquired 100% of OMTEL. Cellnex has also acquired the tower assets of MEO’s rival Nos. Vodafone’s tower portfolio has been carved out into Vantage Towers.  

Telia has agreed the sale of a 49% stake in its Swedish tower business to infrastructure investor Brookfield and Swedish pension fund Alecta. Telia will receive 5.5bn crowns (c. €225mn) for the stake, with the deal expected to close in Q3 2022. Telia had previously agreed the sale of a 49% stake in their Finnish and Norwegian tower business to the two investors.

Russian Towers and their 7,000+ site tower portfolio has been acquired by Kismet Capital Group’s New Towers. In late 2021 Megafon announced the formation of a new towerco venture with Russian independent towerco, Vertical. The towerco venture, subsequently named New Towers, involved Megafon transferring ownership of its 17,000 towers in return for a 25% stake in the entity, with Vertical contributing its 5,000 sites and Vertical’s main shareholder, Kismet Capital securing a 65% stake in the entity. The acquisition of Russian Towers sees New Towers’ portfolio exceed 30,000 sites, positioning it as the 13th largest towerco globally.  

 

The UK’s Competition and Markets Authority has voiced concerns that Cellnex’ deal to acquire CK Hutchison’s UK tower portfolio could lead to reduced competition in the market. The CMA’s concerns centre around the formation of a duopoly where Cellnex and Cornerstone would control 90% of the country’s towers. The CMA has suggested potential remedies and a final decision is expected in early March. 

 

UK operators, EE and 3 have signed a deal with BAI Communications for BAI to provide 4G and 5G ready connectivity along the London Underground. In June 2021, BAI secured a 20-year concession with Transport for London to provide mobile connectivity along the London Underground. All stations and tunnels are set to have mobile coverage by the end of 2024. 

 

 

International roaming charges for travellers between Bolivia, Colombia, Ecuador and Peru were scrapped on 1 January 2022. According to TeleSemana, however, roaming charges have only been abandoned for users with post-paid mobile subscriptions. The elimination of roaming fees removes a source of revenue from operators in the region, but makes travelling among the four nations easier.  

 

Argentina’s telecoms regulator ENACOM has published a list of 5G frequency bands for auction. The publication of the bands in the 1500MHz , AWS-3 , 2.3GHz, 3.5GHz, 26GHz, 38GHz bands pave the way for the announcement of a date for 5G auctions. Making use of existing spectrum and getting a small lead on its competitors Telecom Argentina (Personal) has released plans to extend 5G coverage to the seaside resorts of Mar del Plata, Pinamar and Carilo in addition to the 5G sites active in Buenos Aires and Rosario.  

 

IHS Towers will acquire 2,115 telecoms towers across Brazil from SP5, a portfolio company of Grupo Torresur (“GTS”), one of the leading providers of telecommunications infrastructure in Brazil, for US$315mn. The transaction grows IHS Towers’ Brazilian position to nearly 7,000 sites. Read our analysis

  

Local news reports are suggesting that the sale of Oi’s mobile assets (Oi Movel) to the consortium formed by rival operators Claro, Vivo, and TIM may not be approved by Brazil’s anti-trust authority. The potential obstacle is not entirely clear. But if the purchase is prevented from continuing, then other operators who did not participate in the initial auction of Oi’s mobile assets, Sercomtel and Copel, have expressed interest in buying those assets if the opportunity arises. 

Movistar, WOM and Entel have all activated their 5G networks as of the end of 2021, according to a statement released with telecom regulator Subtel. Movistar’s network will have a national presence by March 2022, deploying a total of 1,500 5G sites by that date. Entel and WOM’s 5G networks are less expansive, but all have confirmed activations and rollout plans. 

 

El Salvador’s competition commission has okayed a sale by Telefónica for the sale of its local Movistar opco to General International Telecom Limited, a UK limited company, for US$144mn. This is less than half the US$315 that was offered by América Móvil as part of a larger deal covering Telefonica’s El Salvadoran and Guatemalan operations. That was stopped by competition authorities over worries it would have left América Móvil in too dominant a position. The move would mark Telefónica’s exit from Central America.   

 

Following the exit of Telefónica and the financial woes of Red Compartida, 5G amendments by AT&T are providing some much-needed tenancies in Mexico. The MNO says it will expand its 5G coverage on a gradual basis, starting with industrial and urban areas. Nicole Rodriguez, Vice President and CTO at AT&T Mexico, commented: ‘In the next three years we will deploy 5G in the main markets of the country, starting with the most important cities.’  

 

 

 

 South Africa took a step towards an 8 March spectrum action as Telkom has dropped its application to call a halt to imminent plans to auction 4G and 5G spectrum, having reached an agreement with the other parties involved in the contested process. A court hearing was held on January 25 which should lead to a clarification of the process shortly.  

 

In the face of continued political unrest and fighting in the north, the Ethiopian Communications Authority (ECA) has suspended the licensing process relating to the issuance of a second mobile telephony licence. The process was restarted on 28 September after a second licence failed to be awarded in 2021, but the regulator halted proceedings on 22 December 2021. Bidders requested a delay. 

 

Airtel has sold its 1,400 towers to the SBA Communications and Paradigm Infrastructure joint venture Minara towers. The transaction is part of Airtel’s strategy in Africa to rid itself of its passive infrastructure and which includes four other transactions with Helios Towers in its other markets. Out of the total consideration of US$175mn for the transaction, around US$157.5mn is payable on the first closing date, which is expected to take place in the second half of the Group's current financial year, with the balance payable in installments upon the completion of the transfer of any remaining towers to the purchaser. 

 

Rural communications firm NuRAN Wireless has signed a ten-year deal with MTN Group to deploy at least 250 sites across rural South Sudan. NuRAN has two years to deploy the sites with the first 50 sites using towers already owned by MTN to ensure the rollout has a swift start. As in Cameroon and DRC, the infrastructure will be operated on a network-as-a-service model, and after ten years ownership will transfer to MTN. 

 

 

 

 

 

 

Australia Tower Network continue to build out the leadership team that will manage the 2,312 towers and rooftop sites spun out from Optus last year. The most recent addition is new Head of Risk, HSEQ and Compliance - Ryan Georges. Georges enjoyed a spell as Senior Health Safety Environment Coordinator at Brookfield from July 2017 to January 2021, before his previous role as Health Safety Environment Quality Specialist at Enel Green Power.  

 

A further Optus carve out could be on the cars as Singtel are reportedly looking to divest their fibre assets which are rumoured to be worth over US$2bn. Singtel are touted to be eyeing up either a stake sale, partnership with an investor, or a sale and lease back arrangement.  

  

 

Md Shahab Uddin, Managing Director of Bangladesh’s government owned operator, has disclosed a plan to establish 2,500 5G base stations across the country in the first wave of the nation’s 5G rollout. The base stations will be rolled out on towers built by Summit group – one of the new towercos that were awarded a license to operate in Bangladesh alongside incumbent edotco in 2018. 

Summit Towers Limited has already built 700 towers across 56 districts over the country. 

  

 

 

In an effort to ease the economic hardship facing India’s 3 private MNOs, the Department of Telecommunications’ (DoT’s) announced it would allow the operators to pay deferred spectrum dues in annual instalments between FY22-23 and FY 34-35. 

 

Market leader Reliance Jio has paid the entirety of the INR307.9 billion (USD4.1bn) it owed for spectrum secured at auctions in 2014 and 2015 and the frequencies it purchased from Bharti Airtel last year; in a move touted to save them INR12 billion annually.  

Vodafone Idea have converted their deferred interest payments into equity, so that the Indian government now holds around 35.8% of the total outstanding shares in the company. The state also controls the fourth operator in the country - BSNL. 

  

 

Upon the completion of the merger between Indonesia’s second and third largest operator, the MCI has disclosed coverage obligations the new entity has agreed to. IOH (Indosat Ooredoo Hutchinson) has been tasked with having at least 52,885 on-air base stations across the country by 2025. IOH is also required to expand service coverage to at least 7,660 new villages and sub-districts – but the company is yet to determine the new network coverage areas.  

 

Meanwhile, MCI has also called on all operators to begin moving to 4G networks. Market leader Telkomsel has responded and stated that it plans to do so, but only if upgrades can be made “sustainably” 

  

 

Myanmar’s military government were reportedly unhappy with Telenor’s decision to sell up shop to Lebanese M1 group, and have allegedly been looking for a local firm to take ownership since the deal was first announced. They may have found one in Shwe Byain Phyu Group (SBP) – a conglomerate that already has ties to the military, who are touted to partner with M1. 

A report by Myanmar Today has claimed the Junta has also announced that it plans to impose a new tax on the sale of SIM cards and a 15% charge on fixed and mobile data services. The government claim this is to reduce the harmful effects of “excessive” data consumption on employment and mental health. Telenor has claimed the levies will reduce the Myanmar people's access to an essential service. 

  

 

Nepal’s third operator – Smart Telecom, has had its license revoked after failing to pay NPR5.5 billion (US$45.8 million) in renewal fees and outstanding liabilities. The Nepal Telecom Authority (NTA) had previously announced plans to scrap the license in 2019, but delayed the decision to give Smart the chance to pay its arrears in instalments by July 2021. 

 

The NTA had previously discussed introducing a fourth operator into the Nepalese market but were dissatisfied with the proposals. Smart Telecom currently sits behind Axiata owned ncell and state-owned Nepal Telecom as Nepal’s third largest operator with a 5.9% market share. 

  

 

MNO’s 2degrees and Orcon Group have announced their plans to merge their entities and create New Zealand’s third largest operator with 1.5 million mobile customers, and around 1,800 tower sites. 2degrees CEO Mark Aue said: ‘Combining the strengths of our respective businesses and the talents of our people will enable us to continue to innovate, enhance our product and service offering to benefit all Kiwis, and to further grow the new business.’  

  

 

The Philippines’ third operator has expressed a target to double its mobile subscription base in 2022. This will be achieved through capital expenditure of US$1 billion to expand its coverage nationwide.  

 

Last year DITO hit its target to amass five million mobile subscriptions and has built over 4,100 cell sites. 

 

 

DTAC and True Corporation are set to close their merger before the end of Q1 2022. True have previously spun off their towers into DIF (Digital Telecommunications Infrastructure Fund), in the only instance of towerco activity in the kingdom. With major towercos eyeing up Thailand as an untapped market in 2022, the merger could set off a renewed interest in tower sharing and increase DIF’s activities.