Monthly News Roundup: September 2023
A round-up off all the latest news in the global tower industry
Regional: A1 Telekom Austria Group's towerco EuroTeleSites goes public
EuroTeleSites, the newly set up towerco which will manage the Group’s passive infrastructure assets in six Central and Eastern European (CEE) countries, was listed on the Vienna Stock Exchange on 22 September. The towerco's shares started trading at a price lower than expected (EUR 4.31 per share versus a reference price of EUR4.95 per share), which resulted in a market capitalisation of EUR716mn (USD$763.4mn).
Following the Group’s carve out of towers in Bulgaria, Serbia, Croatia, Slovenia and North Macedonia into separate legal entities (A1 Towers) between 2021 and 2022, the company spun off just over of its 6,000 sites in Austria in H2 2023. All of the Group’s European towers (barring the Belarus ones) will be managed by EuroTeleSites. A1 Telekom Austria has also transferred EUR 1bn of debt to EuroTeleSites.
Regional: Cellnex changes organisational structure
The towerco has announced its new organisational structure which includes a recently created Strategy department to be headed by former Managing Director of Cellnex France, Vincent Cuvillier.
In addition, the position of Chief Operating Officer (COO) has also been created and will be assumed by Simone Battiferri. Both new post holders will report directly to CEO Marco Patuano and will be part of Cellnex’ Executive Committee along with the Chief Financial Officer (CFO) who is yet to be appointed. The managing directors of the towerco's markets will become part of Cellnex's Executive Committee.
CEO Patuano has said that “this new structure has been designed to enhance and strengthen Cellnex’s growth for the future."
Denmark: TDC explores strategic options with LionTree
Danish MNO TDC has hired US investment firm LionTree to explore strategic options for its business according to information by Reuters.
LionTree which is half-owned by Australian asset management firm Macquarie is conducting a strategic analysis of the Danish market and TDC’s business. TDC has reported a decline in financial performance for the first half of 2023. It is not yet confirmed if a transaction will take place. TDC have separated out their service and infrastructure divisions, with TDC Net managing the operator’s infrastructure for fixed and mobile networks and Nuuday managing the service side.
Germany: Vantage Towers launches onsite wind power generation
Vantage Towers has launched onsite power generation by micro turbines on one of 52 of its macro towers involved in a project around Cologne, the towerco has announced.
Eight micro turbines have been installed on the asset, with a total of 756 micro turbines to be installed on all of the towers within the project. The generated energy is consumed directly onsite and will only be fed into Vantage Towers’ anchor customer Vodafone initially.
Vantage Towers has cooperated with Berlin-based wind energy start-up MOWEA, whose micro turbines will produce around 7 MWh per year per tower at average wind speeds.
Nordics: Stonepeak buys minority stake in Cellnex Sweden and Denmark
New York-headquartered investment firm Stonepeak has bought a 49% stake in Cellnex’s subsidiaries in Sweden and Denmark for EUR730mn (USD$769.2mn), the towerco has announced.
Cellnex manages 4,557 sites in both countries and has a build-to-suit pipeline of approximately 2,500 sites.
Cellnex will use the proceeds of the deal to reduce its debt in line with its objective to achieve an investment grade credit rating by S&P. The transaction is subject to regulatory approvals and is expected to complete in 2024.
Malta: GO to sell towers to BMIT Technologies
Maltese MNO GO has announced it has reached an agreement to sell its 280 sites to local data centre and IT services provider BMIT Technologies for EUR47.1mn (USD$49.8mn). GO will remain as the anchor tenant on the sites.
The deal also includes a BTS program of around 30 sites to be built by GO to support ongoing 5G rollout and network coverage requirements across the Maltese islands by 2030 and to be transferred to BMIT by the end of 2030.
GO offers mobile and fixed connectivity in Malta and Cyprus, as well as TV services, high-speed broadband, and other digital connectivity services. It is listed on the Malta Stock Exchange.
Switzerland: Regulator to allocate spectrum for mobile private networks
The Swiss regulator Ofcom has confirmed it is planning to make frequencies in the 3400MHz-3500MHz range available for private 5G mobile networks on 1 January 2024.
The spectrum will be used by universities, businesses and organisations to operate their high-speed network over a defined area. If several licence users are in the same area, spectrum will be made available on a shared basis. At present it is working on finalising the regulatory and technical framework for the licensing of campus networks by end-2023.
Argentina: Three operators to bid for 5G spectrum
Movistar, Personal and Claro will all participate in Argentina’s 5G spectrum auction, after Infraestructura Digital Argentina (IDA) dropped its legal challenge. 300MHz of spectrum will be made available in three 100MHz blocks with a base bidding price of US$350mn. The auction is now expected to take place in the first week of November.
Brazil: IHS Towers announce plans for 750 new sites
IHS Towers expects to deploy 750 new cell towers in Brazil this year, taking its total from 7.139 to nearly 8,000. The target was disclosed to Mobile Time by CEO Sam Darwish. Mr Darwish commented: ‘We look at acquisition opportunities everywhere, as long as it is something that makes sense strategically. But since 2021 the cost of capital has risen. The context now is this: growth is vanity; profit is sanity; and cash is king. In other words, you need to manage your growth carefully. Our core is that of a builder. It is through construction that we can add value.’
Brazil: 2G and 3G shutdowns on their way
Freeing up space on towers for 4G and 5G equipment, Anatel has confirmed it is planning to issue subsidies to remove 2G and 3G equipment from their networks. There are 21.5mn 2G subscriptions and 21.0mn 3G subscriptions in Brazil, including M2M connections.
Chile: 5G rollout continues and new auctions planned
Another 50MHz block of spectrum in the 3400MHz-3600MHz band wil be auction in January next year. This comes as Chilean MNO Entel completes the second phase of its 5G rollout two months ahead of its deadline. The company’s 5G network now covers 311 communes on 1,371 towers.
Colombia: Fate of Tigo Colombia still in doubt
Following financial difficulties Tigo Comolmbia’s owners Millicom and Empresas Publicas de Medellin (EPM) are trying to settle on a new ownership structure. There have been months of will they won’t they on a dilution of EPM’s share and how to recapitalise the mobile operator. Hopefully the operator can be stabilised and resume meeting its 4G rollout commitments.
Vietnam: 2G switch-off to commence in December 2023
Vietnam is planning to start the deactivation of its 2G networks in December 2023, as the authorities seek to optimise the country’s spectrum reserves. According to the Ministry of Information and Communications (MIC), the country’s mobile operators have designed technical solutions to eliminate 2G and 3G-only devices and will start locking 2G devices from December.
2G-only subscriptions have gone into heavy decline in recent years, and the MIC projects that the total number of 2G users will stand at around six million when the deactivation programme gets underway. A full 2G switch-off will follow in 2024.
Vietnam: 5G auction to go ahead in November
Vietnam’s Ministry of Information and Communications is expected to initiate a multi-band auction of 5G spectrum in November this year. The sale process will comprise frequencies in the 700MHz, 2600MHz and 3700MHz bands. The licences are expected to be awarded by year-end, with commercial use anticipated from 2024. The government signed the plan for the spectrum sale on 18 August 2023. The Ministry gave the Authority of Radio Frequency Management the job of setting the base prices for the spectrum auction.
Japan: DOCOMO looking at a tower sharing deal with JTOWER
JTOWER and NTT DOCOMO have agreed a new master transaction agreement aimed at facilitating the sharing of the latter’s telecommunication tower infrastructure. Under the agreement, the ownership of 1,552 DOCOMO towers will be transferred to JTOWER for JPY17 billion (USD114 million), with the mobile operator subsequently leasing the towers back from the towerco. DOCOMO is understood to be actively working to build a viable 5G network by promoting infrastructure sharing and this transaction is designed to enable further streamlining of its network operations. Previously, in March 2022, the two companies entered into the master transaction agreement allowing the transfer of 6,002 of DOCOMO’s telecommunications towers to JTOWER. The addition of this new agreement will enable them to strengthen their network building, while also enabling the towers to be used for a wider range of applications, facilitating the further sharing of infrastructure.
Japan: Rakuten Mobile to apply for new frequencies
Japan’s Ministry of Internal Affairs and Communications has published details regarding applications for certification regarding the government’s plan to roll out mobile communication systems in the 700MHz band. In a press release dated 3 October, the Ministry confirmed that fourth mobile network operator Rakuten Mobile was the sole company to apply for the slots on offer during the application phase which ran from 29 August to 29 September 2023. Whilst its larger rivals, NTT DOCOMO, KDDI Corp (au) and SoftBank Corp, each hold bands in the 700MHz-900MHz range, Rakuten Mobile does not. It is understood that the Ministry will ask the relevant advisory body, the Radio Regulatory Council, to examine the application on 23 October 2023. The Council’s decision rests on its review of Rakuten Mobile’s rollout plan and whether it meets the minimum requirements in terms of coverage targets, base stations facilities and financial investment.
Nepal: Government plans to extend mobile coverage across highways
The Nepal Telecommunications Authority and Ministry of Communications and Information Technology have approved a NPR1 billion (USD7.4 million) plan to extend mobile coverage across the country’s network of highways by April 2024. The project will prioritise stretches of the Prithvi, East-West, Araniko, Sagarmatha, BP, Karnali, Mid-Hill and Hulaki highways where services are currently unavailable, in line with the government’s Telecommunications Policy 2004 which seeks to expand connectivity to unserved areas. The regulator will ask the country’s mobile network operators – Nepal Telecom and Ncell – to submit their proposals by the end of the year.
Malaysia: DNB’s 5G network coverage has reached 68.8%
Digital Nasional Berhad (DNB) achieved coverage of 68.8% of populated areas of Malaysia with its 5G network as of 31 August 2023. Looking ahead, DNB is expected to achieve coverage of 80% by early 2024. According to the country’s communications minister, Fahmi Fadzil, the nation’s major telecoms companies are set to sign share subscription agreements (SSAs) for their equity stakes in DNB soon. In July 2023 it was announced that the Malaysian Communications and Multimedia Commission’s ‘5G Task Force’ had successfully reached an agreement regarding equity participation in the wholesale 5G operator with five operators, namely CelcomDigi, Maxis, Telekom Malaysia, U Mobile and YTL Communications.
Philippines: Telco DITO scores USD3.9bn funding deal with banks
DITO Telecommunity’s parent company, DITO CME Holdings, signed a USD3.9 billion long-term loan agreement with several multinational banks. In a filing submitted on 20 September, DITO CME referred to the agreement as ‘one of the largest long-term debt arranged and syndicated by a group of multinational banks for a Philippine corporation’. The funding will be used to repay another loan of approximately USD1.3 billion, as well as to support DITO Telecommunity’s network expansion to boost network quality and availability, and to improve the end-user experience. The new third telco said the funding would help accelerate its entry into the 5G and post-paid mobile sectors. In addition, DITO Holdings Corp, the majority shareholder in the Philippines’ third telco DITO Telecommunity, has sold another block of shares to an external investor, Summit Global, as it strives to fund the network rollout of its greenfield telco. The new investor acquired an 18.5% stake in DITO Holdings Corp for PHP2.24 billion (USD39.4 million).
Philippines: Telco Globe takes out USD264m Metrobank loan
On 25 September, Globe Telecom said that it has taken out a PHP15 billion (USD264 million) loan with Metropolitan Bank & Trust Company to finance its capital expenditures this year, as well as for debt refinancing and other general corporate requirements. Globe has already invested PHP37.7 billion in CAPEX in H1 2023, 25% lower than in the same period of 2022 as it strives to bring free cash flow back to ‘more sustainable levels’, to help drive the buildout of 542 new cell sites and upgrades to 5,087 mobile sites in the country as of end-June 2023. The company also said it now has 356 new 5G sites built across the country and has tapped Nokia’s antennas for ‘faster 5G rollout’ as it looks to defend its position as the number one telco in terms of mobile subscriptions.
India: Operator Vi clears 5G spectrum installment
Indian mobile operator Vodafone Idea (Vi) has paid INR17.01 billion (USD204.6 million) towards the second annual instrumental for its 5G spectrum, the operator confirmed in a regulatory filing. Vi had stated last month that it would make use of the 30-day grace period to clear the dues and that one of its promoter companies – the UK’s Vodafone Group and India’s Aditya Birla Group – had committed to pay the dues if the telco could not raise the funds in time. Potential punitive measures for failing to clear the dues within the 30-day period following the initial deadline of 17 August included the cancellation of Vi’s 5G spectrum allocation and its exclusion from future auctions for up to three years.
India: Airtel hits 50m 5G subscriptions
Indian operator Bharti Airtel announced that it has signed up more than 50 million unique 5G subscriptions within a year of launching commercial services over the network. Airtel also reported that it has extended its 5G footprint to almost every district across the country and the system is now available across all 28 states and eight union territories. The only districts not covered by Airtel’s ‘5G Plus’ network were disputed territories in Kashmir. This marks a big expansion of Airtel’s 5G coverage going from one million in October of 2022 to 50 million in just twelve months of the launch.
Indonesia: XL Axiata and Smart Telecom in merger talks
The Ministry of Communication and Informatics (MCI, known locally as KemKominfo) has confirmed that two of the country’s major telecoms operators, XL Axiata and Sinar Mas Group-backed Smart Telecom (Smartfren), have entered into discussions about a possible merger, aiming to achieve greater operational efficiency. Malaysia-based Axiata Group and Indonesian conglomerate Sinar Mas began exploring the possibility of a merger back in October 2021. Axiata and Sinar Mas have recently revived the merger plan, although analysts suggest that any amalgamation of XL and Smartfren could prove challenging given the latter’s high level of debt.
Kenya: Safaricom issues green financing loan
Safaricom has signed a US$102.95mn loan with domestic banks to support the funding of environmentally sustainable projects in their home market of Kenya. Standard Chartered Bank Kenya, Stanbic Banka, ABSA Kank Kenya and KCB Bank all form the consortium of lenders. Energy is a priority for the MNOs network strategy and is currently exploring partnerships with ESCOs in the market, as well as working with both local towercos and American Tower to provide tower + power services.
Uganda: American Tower and Smile dispute goes to arbitration
In June last year, 4G provider Smile claimed that its network had been illegally disconnected by American Tower Uganda, arguing this went against the towerco’s license obligations and industry best-practice. The Ugandan High Court has ruled that Smile Communications and American Tower must settle their dispute via arbitration. Both parties had been involved in commercial disputes since 2018 over discriminatory pricing practices, with Smile claiming American Tower was collecting 50% more than the tariffs set but the regulators. Smile is seeking US$2.1mn in compensation from what is considers an illegal breach of American Tower’s contract, along with additional settlement for economic distress and damage to goodwill.
Ethiopia: 3rd MNO license RFQ submission delayed
Ethiopia’s ongoing bid for a third MNO license has run into delays, with the Ethiopian Communications Authority (ECA) requesting a delay to the submission date for the Request for Qualification (RFQ). A 15th September deadline had originally been set, but the ECA received requests from potential investors to extend the deadline, which is not set for October 6th. With Safaricom’s delayed but so far successful network rollout to compete with state incumbent Ethiotel, a third MNO license would help close the country’s massive demand for connectivity. However, with a new round of conflict flaring up in the Amhara region, investors may be having second thoughts about the risks associated with the market.
Botswana: BTC plans to go copper-free to escape the cost of theft
Botswana Telecommunications Corporation (BTC) expressed their huge challenge with copper theft, that led to a 23% drop in pretax profits since the start of 2023, largely due to the US$4.11mn of stolen copper cables so far this year. BTC announces its plans to go copper-free in the capital Gaborone by the end of 2024 and is stepping up investment in fibre networks.
Nigeria: Airtel partners with Watt Renewable for solar PV
Airtel Nigeria has partnered with ESCO Watt Renewable Corporation to deliver over 32MW of solar PV capacity and storage across 600 sites as an energy-as-a-service model. The deal will help Airtel manage challenging uptime requirements while expanding network coverage, as well as scaling power equipment to support 4G and 5G upgrades. Watt Renewable will also be supporting Airtel’s reduction in scope 1 emissions. Watt will become responsible for the maintenance and operations of energy generation on all 600 sites.
Nigeria: IHS Towers loses lease renewal with MTN to American Tower
In a surprising move, MTN Nigeria has declined to renew one of their leases with IHS Towers for 2,500 towers and from 2025 will instead be switching equipment onto existing and new towers of competitor towerco American Tower. The new tenancy contract will include removing all equipment and power infrastructure from IHS Towers sites and relocate to American Tower sites. It is understood that most of these sites will need to be newly built.
American Tower has commented that they “have a strong partnership with MTN in Nigeria and Africa more broadly and looks forward to continuing to support MTN’s infrastructure and network expansion needs through AMT’s existing asset base, BTS capabilities and power as a service program”. MTN commented that American Tower was “selected as the preferred tower company for those sites based on its superior bid submission” after a review of the bids received for the tower contract.
MTNs decision to renew with IHS competitor American Towers has also shaken up shareholder Blackwells Capital, who are now calling for the resignation of IHS chairman and CEO Sam Darwish.
Madagascar: TowerCo of Africa rebrands Madagascan unit
TowerCo of Africa announced the brand transition of its Madagascan unit to TowerCo of Africa Madagascar, as part of a wider company-wide rebranding campaign to better align with a more cohesive brand across its markets. A subsidiary of parent company AXIAN Group, TowerCo of Africa has expanded from its home market in Madagascar into Uganda, Tanzania and the DRC, with a rebranding already completed in the former country. The towerco has elevated itself to becoming a pan-African infrastructure provider with a focus on greenfield deployments, as well as opportunities to expand through sister company AXIAN Telecom’s assets.
Jordan: Orange launches 5G private network
With Orange and Umniah racing ahead in the race to deploy 5G, Orange Jordan has established its first private 5G network in the country for Aqaba Container Terminal (ACT) to help support the latest technology adoption. This makes Orange Jordan the first in MEA withing the group to launch a 5G private network for business sector customers. ACT serves as the logistical and economic backbone of the Aqaba Special Economic Zone Authority (ASEZA) and has adopted advanted technology, equipment and facilities to support its cargo operations. 5G has seen successful enterprise use-cases in port authorities, who are driving the adoption of AI and automation to drive efficiency in the transportation and logistics sector.
Qatar: Ooredoo deploys Ericsson’s Smart Connected Site Solution to cut emissions
Ooredoo Qatar has partnered with Ericsson to deploy the OEM’s Smart Connected Site solution that will increase the MNOs network energy efficiency and cut carbon emissions. On-site power generation will be hybridized using lithium-ion batteries as well as grid and diesel back-up generators. The solution includes remote monitoring of radio, power and enclosure and site material operating data and status to optimize energy use and reduce both diesel and grid reliance.
Trials run by Ericsson showed up to 66% reduction in daily generator runtime and up to 55% reduction in fuel consumption, translating to a drop of 3 tons of CO2 emissions per month and halving the number of site visits. Ooredoo Qatar is investing in innovative solutions for sustainable energy management in line with Qatar’s National Vision 2030 strategy of reducing greenhouse gas emissions by 25% by 2030.