Sub-Saharan Africa news

A roundup of tower news across SSA

Regional: Airtel Africa appoints banks for IPO plans; tower sale on hold?

Airtel Africa has kicked off its IPO plans, appointing eight banks (Goldman Sachs, JP Morgan, Citigroup, BofA Merrill Lynch, Absa Group, Barclays, BNP Paribas and Standard Bank) to run the process. The move is part of Airtel Africa’s plans to reduce its debt which currently stands around US$5bn whilst also providing funds to support its operations in an increasingly competitive market.  Airtel had previously commenced plans to sell towers in five markets in which it is yet to divest tower portfolios, reportedly having received bids from multiple towercos and beginning the process to narrow down the offers to 2-3 shortlisted bidders. With IPO plans looking to move forward, observers feel that the tower sale may be delayed until after the listing is finalised although at the time of going to press we await further news.

Regional: MTN annual report moots potential disposal of towerco equity stakes 

MTN’s recently released annual report hints that some or all of the equity stakes it has built up in African towercos may be sold off. The report states: “We also reviewed our non-mobile assets, including our existing investments in tower companies and e-commerce ventures. While these are important and material investments where we need a tight commercial and operational integration with our mobile assets wherever possible, they are not viewed as long-term strategic holdings of the group. As a result of this review, we plan to realise at least R15 billion in asset realisations over the next three years excluding any proceeds from IHS. Proceeds will be used to reduce holding company debt.” TowerXchange understands MTN owns a substantial minority stake in IHS Towers as well as 49% stakes in ATC Ghana and ATC Uganda. The telecom giant also plans to pull back from its marginal telecoms markets and has already sold its 53% shareholding in Mascom Wireless Botswana to Zimbabwe’s Econet for around US$300 million.

Angola: MTN withdraws from fourth license tender

MTN has reportedly withdrawn its interest in acquiring Angola’s fourth MNO license, claiming that the tender is flawed. Angola currently has two operational MNOs, market leaders Unitel who dominate the market and Movicel, whilst Angola Telecom holds the country’s third MNO license. Reports suggest that MTN’s withdrawl leaves just one player in the running for Angola’s fourth operating license, a local start-up called Telstar Telecomunicacoes.

Burkina Faso: 4G rollout on the horizon as government approves technology neutral licenses

The government of Burkina Faso has approved technology neutral licenses, enabling the country’s MNOs to use 2G and 3G spectrum for 4G networks. Onatel (owned by Maroc Telecom) launched 4G trials in December, with Orange having trialled 4G in November, suggesting that the operators are ramping up for a launch.

Ethiopia: New regulator to enable telecoms competition in Africa’s second largest country

Ethiopia announced the creation of an independent telecoms regulator to oversee and manage the communications sector. Establishing an independent regulator is one of the key steps towards privatising Ethio Telecom and the issuance of licences enabling international MNOs to enter the country, ending one of the few remaining state monopolies in Africa. A surge in investment form 2013 onwards saw coverage expand from below 30% to around 60% today, but further expansion has stalled due to a lack of debt capacity by the Ethiopian state. The announcement of an independent regulator follows last month’s announced investment in a new fibre-optic backbone for the East African state, and the broader liberalisation programme championed by Prime Minister Abiy Ahmed.

Ethiopia: Ethiopian tower sale mooted as Ethio Telecom privatization heats up

ToweXchange can reveal that discussions on how to privatise Ethio Telecom’s towers are also taking place. Ethiopia Prime Minister Abiy Ahmed confirmed the Ethio Telecom privatisation was going ahead in the Financial Times and that the telco was the number one priority for privatisation. TowerXchange understands there are ambitions to finalise the privatisation by the end of the year and to issue up to two further operator licences. A number of African and Middle Eastern carriers are said to be showing an active interest. TowerXchange further understands that ownership of the country’s 7-8,000 existing towers remains undecided, with multiple options being explored, including management within Ethio Telecom, a partnership with an independent towerco or a comprehensive sale and leaseback. Plans on how to manage the country’s substantial build-to- suit requirements are also ongoing. Infrastructure coverage of Ethiopia is at about 85 percent and there are 60 million mobile subscribers in a population of 105mn.

Ghana: AirtelTigo completes network integration 

After having merged operations in October 2017, AirtelTigo has announced that it has completed the integration of Airtel and Tigo’s respective networks. The operator is now Ghana’s third largest operators by subscribers.

Ghana: Vodafone starts 4G roll-out, go-live expected in March or April

Following a successful acquisition of two 5MHz of 800Mhz bands for US$30mn in January, Vodafone Ghana have announced the imminent launch of 4G services. They announced 200 LTE sites have already been deployed with more expected.

Kenya: Airtel Kenya and Telkom Kenya to merge

Following abandoning talks in June of last year, this week it was announced that Airtel Kenya and Telkom Kenya have agreed to a merger. The new company will operate as Airtel-Telkom and will seek efficiencies of scale and improvements to operations to propel the combined entity into profitability. Both brands will survive independently but it is hoped the merged company will be better able to compete with Safaricom, which currently holds 69% of the Kenyan market. It is unclear where this leaves the KES1 billion (USD9.8 million) fibre, 3G and 4G investment announced by Telkom Kenya last month. Telkom is 60% owned by Helios Investment Partners, with the rest held by the Kenyan government. Airtel Kenya’s sole shareholder is India’s Bharti Airtel. Eaton Towers acquired Airtel’s Kenyan portfolio of 1,285 towers when Airtel Africa divested most of its African towers. Last year American Tower acquired 715 towers from Telkom Kenya. Only a limited number of towers overlap, and so it is unclear to what extent this merger will lead to decommissioning over the short term.

Kenya: After merger announcement, Airtel expands 3G and 4G coverage 

Following the announcement of a merger between Airtel Kenya and Telkom Kenya, Airtel Kenya has announced plans to roll-out over 800 3G and 4G sites across 40 locations to improve the reach and quality of its data services. The announcements follow Saraficom’s half year results announcement that its 4G coverage had grown 21ppts year on year to 53%, and its 3G coverage to 91%.

Niger: Government orders closure of Airtel and Orange offices over unpaid taxes

The Niger government has ordered the closure of Airtel’s operations in the country over reportedly unpaid taxes accounting to 62mn CFA francs. Airtel, Niger’s largest operator disputes the claim which accounts to approximately 70% of its annual revenues from the market. The news follows on from recent steps taken by Niger’s tax authorities on Orange’s opco in the country, with the government demanding 22bn CFA francs, a figure disputed by the operator.

Nigeria: MTN and Central Bank of Nigeria reach agreement over repatriation dispute

After an ongoing dispute regarding the alleged inappropriate repatriation of US$8.1bn by MTN Nigeria, the operator has submitted documentation to the Central Bank of Nigeria which has satisfied the bank that historical dividend payments to MTN Nigeria’s shareholders do not need to be reversed. The bank has however maintained that private placements of around US$1bn in 2008 were irregular and a such MTN and the CBN have reached a resolution that MTN will pay the notional reversal amount of US$52.6mn without admission of liability. 

South Africa: Liquid Telecom to launch open access LTE network 

Liquid Telecom has announced plans to launch an open access LTE network in 2019, offering wholesale roaming to other MNOs.

South Africa: Helios Towers forms South African JV and announces deal for SA Towers

Helios Towers South Africa (HTSA) was formed earlier this year. It is 66% owner by Helios Towers and 34% owned by local full-service fibre and mobile network construction provider Vulatel. Helios Towers owns over 6,500 towers in Tanzania, Democratic Republic of Congo, Ghana and Congo Brazzaville, and is now entering South Africa to build greenfield mobile tower infrastructure and fibre-optic infrastructure. Shortly after its announced formation, it was also announced that HTSA was acquiring a controlling stake in SA Towers for an undisclosed sum. The acquisition of SA Towers will come with a small portfolio of towers, a pipeline of build-to-suit tower opportunities and a management team with extensive local planning and permitting experience. 

South Africa: Electronic Communications Amendment (ECA) Bill withdrawn, wholesale open-access network (WOAN) in doubt 

South Africa’s new communications minister Stella Ndabeni-Abrahams has withdrawn the Electronic Communications Amendment (ECA) Bill. Among other changes to telecoms regulation, the ECA Bill had proposed the creation of a wholesale open-access network (WOAN) which would have been handed high-demand spectrum and tasked with creating a carrier neutral network of shared wireless infrastructure. The ECA Bill and its proposed wholesale network and forced infrastructure sharing had been widely opposed by the South African telecoms sector. It is unclear if the ECA Bill will be reintroduced in its current form or if plans for the WOAN have been shelved permanently.

South Africa: Rain and Nokia launch 5G-ready network in Cape Town

South African operator Rain and Nokia have announced the first 5G-ready network in South Africa. The deployment is set to start in the first quarter of 2019 with services launching mid-2019 when 5G ready handsets become available. The deployment uses 3600MHz spectrum because rain already owns the 5G-capable frequencies, the system uses Massive MIMO technology. The roll-out will continue through 2020 and extend coverage to more areas.

Tanzania: Airtel Tanzania resolves ownership brouhaha with Tanzanian government

Bharti Airtel’s stake in Airtel Tanzania is to be reduced from 60% to 51% following a settlement with the government which sees the state’s share increase from 40% to 49%. The value of the deal was not announced. The deal was made necessary by claims from Tanzania’s President John Magufuli that Bharti Airtel illegally acquired its Tanzania subsidiary from Tanzania Telecommunications Company Ltd (TTCL) and that the state had been cheated out of shares. Bharti Airtel had disputed this saying it had followed all necessary protocols and acquired all necessary approvals. However, the resolution of the dispute clears one hurdle in the way of an Airtel Africa IPO, which would have been difficult were ownership of its Tanzania subsidiary not clarified.

Leave a Reply