The telecom tower industry in the Middle East and North Africa (MENA) region is in the midst of substantial change, driven by significant developments such as Zain Group’s acquisition of the remaining 70% of IHS Kuwait and the Jazz-Engro partnership in Pakistan. Zain's recent transaction, valued at US$134 million for the remaining stake in IHS Kuwait, strengthens its position in the Kuwaiti market and continues a trend of consolidation within the region. The deal follows Zain’s ongoing efforts to merge its assets with Ooredoo under TASC Towers, a move that could reshape the Kuwaiti telecom infrastructure landscape by creating a combined entity managing roughly 3,889 sites. This transaction exemplifies the growing importance of infrastructure sharing and consolidation across the MENA region, where both tower companies (towercos) and mobile network operators (MNOs) are seeking to enhance efficiency and reduce operational costs.
IHS Towers’ decision to exit Kuwait, despite its pioneering role in launching the sale-and-leaseback model in the region, highlights the financial challenges towercos face, especially those with high debt levels. The company's pullout is part of a broader strategic review aimed at driving shareholder value and reducing leverage, showcasing the difficulties some towercos encounter in maintaining profitability. IHS Kuwait’s towers were acquired by Zain at a 14.2x EBITDA multiple, reflecting the strong demand for telecom infrastructure but also the cautious approach towercos like IHS are taking in balancing growth with financial stability. In contrast, Helios Towers has demonstrated resilience, bolstered by its acquisition of Omantel’s tower assets, which helped it maintain solid financial performance. This contrast between IHS Towers’ financial pressures and Helios Towers' stability in Oman serves as a cautionary tale for the towerco sector in MENA, particularly as more players look to consolidate their positions.
Saudi Arabia has emerged as a critical market for telecom tower consolidation. The merger of TAWAL, the infrastructure arm of STC, with LATIS will create a major player in the regional telecom infrastructure landscape, managing nearly 30,000 towers across an international footprint. This merger, supported by the Saudi Public Investment Fund (PIF), aligns with the kingdom's broader ambitions for its smart city projects, such as NEOM, and other mega-projects, setting Saudi Arabia apart from the rest of the region. Additionally, Mobily is exploring a potential sale of its tower assets, further contributing to the ongoing consolidation in the Saudi tower market. Should Mobily proceed with the sale, the likely buyer would be PIF, which is in the process of restructuring the country’s telecom infrastructure to streamline operations and increase efficiency.
Meanwhile, Pakistan is experiencing significant developments in its telecom tower market. The Jazz-Engro deal marks a pivotal moment in the country’s telecommunications landscape, with Jazz, Pakistan’s leading digital operator under VEON, joining forces with Engro Connect to optimise the management and usage of telecom infrastructure nationwide. The partnership is framed within a legal scheme of arrangement and regulatory requirements, integrating Jazz's infrastructure arm, Deodar (Private) Limited, with Engro Connect. This collaboration is expected to drive long-term benefits for both companies, allowing Jazz to continue leasing Deodar’s extensive infrastructure while maintaining its focus on core digital services such as fintech, entertainment, and cloud solutions. Jazz’s shift to an asset-light model is part of its broader strategy to streamline operations and focus on high-growth digital sectors, with the partnership expected to strengthen the company’s ability to provide seamless connectivity and digital services to millions of Pakistanis. For Engro Connect, the deal represents a significant step in supporting Pakistan's telecom ecosystem by providing cost-effective infrastructure solutions, which will ultimately drive progress and affordable connectivity across the nation.
Pakistan’s telecom market has seen slower build-to-suit (BTS) growth in 2023 due to macroeconomic volatility, supply chain challenges, and import restrictions. However, towercos have deployed around 10,000 sites over the past five years and expect to roll out another 10,000 to 15,000 in the coming five years. Additionally, the completion of e& and PTCL’s acquisition of Telenor and its consolidation with Ufone is expected to drive up the market’s low ARPU, creating a more stable investment environment. Jazz’s failed attempt to sell Deodar to TASC Towers reflects the complexity of Pakistan’s market, where MNO consolidation and towerco consolidation are still ongoing, but the deal with Engro marks a positive step towards long-term stability and growth.
Across the MENA region, other MNOs are also reassessing their infrastructure strategies. Orange had been reviewing its tower assets across 14 markets in the Middle East and Africa, but unclear regulations and high tax rates have made large-scale carve-outs difficult. However, there are still opportunities for joint ventures and selective carve-outs, with Orange reportedly in talks with Vodacom and Vodafone regarding potential infrastructure-sharing partnerships. Similarly, e& (formerly Etisalat) has been working on a tower strategy, but the group’s complex joint-venture structure across markets like Pakistan, Egypt, and Morocco makes it challenging to formulate a cohesive regional approach. A spokesman for e& noted that no major developments are expected in the next 12 to 18 months, but the group remains focused on optimising its tower infrastructure.
Telecom Egypt is also exploring the sale of its 2,500 towers, with bids ranging between US$150 and US$250 million. This sale, which could include a build-to-suit commitment of 1,500 to 2,000 sites, was initially expected to be finalised by Q1 2024, though discussions are still ongoing. Vodafone Egypt, which was recently transferred to Vodacom Group, is also in the early stages of a potential tower carve-out, mirroring its South African strategy of forming operator-owned infrastructure services under MAST Services.
The MENA region’s tower industry is seeing accelerated growth and transformation, with many MNOs opting for towerco partnerships to drive efficiency and value creation. The TASC Towers merger with Ooredoo is expected to take 12 to 18 months to complete, with Ooredoo’s 20,000 towers being handed over in phases. It remains unclear when Zain’s towers in markets like Bahrain, Sudan, and South Sudan—where progress is delayed due to conflict—will be included in the handover. These developments underscore the rapid evolution of the region’s telecom infrastructure landscape, where state involvement, operator balance sheets, and collaboration between MNOs and towercos are driving a wave of consolidation and innovation.
Figures included in the report:
Figure 1: : Estimated ownership of MENA’s telecom towers
Figure 2: Tower counts across MENA markets
Figure 3: Footprints of MENA’s major MNOs
Figure 4: Heatmap of tower deals and towerco activity in MENA
Figure 5: Algeria – estimated tower count
Figure 6: Egypt – estimated tower count
Figure 7: Iran – estimated tower count
Figure 8: Iraq – estimated tower count
Figure 9: Jordan – estimated tower count
Figure 10: Kuwait – estimated tower count
Figure 11: Morocco– estimated tower count
Figure 12: Oman– estimated tower count
Figure 13: Pakistan – estimated tower count
Figure 14: Qatar Mobile Market Share
Figure 15: Saudi Arabia – estimated tower count
Figure 16: Tunisia – estimated tower count
Figure 17: UAE Map towermarket overview
Figure 18: Major tower transactions in MENA since 2017