TowerXchange’s Africa Guide: Q1 ’21 update

A country by country guide to the African telecom tower industry

Read this article to learn:

  • Country by country tower counts and a breakdown of who owns what
  • A history of all tower transactions across the continent with deal values
  • Details of all Africa towercos and their respective tower counts
  • SIMs per tower and relative market development
  • The latest news and rumours, updated every quarter
  • Key trends across the industry

The Q1 ’21 update of TowerXchange’s guide to the Africa tower market is now available. This 38 page report covers the latest news and market dynamics in 24 African markets, and includes tower counts by country and by company.

Download the report

Figures included in the report:

Figure 1: Breakdown of ownership of Africa’s 169,347 telecom towers (Q1 2021)
Figure 2: Estimated tower counts for selected countries in SSA
Figure 3: Tower counts for major towercos
Figure 4: TowerXchange SSA towerco activity and tower transaction heatmap~
Figure 5a: Multi-country towerco footprints in sub-Saharan Africa
Figure 5b: Single-country towercos
Figure 6: ESCO footprint in sub-Saharan Africa
Figure 7: Angola – estimated tower count
Figure 8: Burkino Faso – estimated tower count
Figure 9: Cameroon – estimated tower count
Figure 10: Congo Brazzaville – estimated tower count
Figure 11: Cote d’Ivoire – estimated tower count
Figure 12: DRC – estimated tower count
Figure 13: Gabon – estimated tower count
Figure 14: Ghana – estimated tower count
Figure 15: Kenya – estimated tower count
Figure 16: Madagascar – estimated tower count
Figure 17: Malawi’s slow mobile broadband (Kbps)
Figure 18: Mozambique – estimated tower count
Figure 19: Nigeria – estimated tower count
Figure 20: Senegal – estimated tower count
Figure 21: South Africa – estimated tower count
Figure 22: Tanzania – estimated tower count
Figure 23: Uganda – estimated tower count
Figure 24: Zambia – estimated tower count
Figure 25: Zimbabwe – estimated tower count
Figure 26: Africa’s biggest tower transactions to date

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Foreword 

As of March 2021, towercos own and manage 40.3% of Sub Saharan Africa’s 169,347 telecom towers. ESCOs manage power at 19,723 sites, for both towercos and MNOs. After a few years of relative stability in the industry, things are changing fast.

75% of towerco-owned towers are owned by the Big Three of IHS Towers, American Tower and Helios Towers, but a number of alternative towercos are sprouting up to challenge and complement the existing hierarchy. Four towercos stand out, either for their formidable management teams and financial backing or because of their successful recent rollouts:

  • Africa Mobile Networks: Africa’s fastest growing towerco, Africa Mobile Networks is a rural specialist that has built nearly 2,000 sites from a standing start. Its unique revenue share model, low-cost sites and NaaS offering is a potentially disruptive alternative to the traditional towerco model.
  • Eastcastle Infrastructure: Established by Peter Lewis and Pankaj Kulshrestha and currently courting investment from African Infrastructure Investment Management, Adenia Partners and the IFC, Eastcastle is targeting the build-to-suit opportunity and plans to deploy 1,950 telecom towers across west Africa, including Nigeria, Cote d’Ivoire and the Democratic Republic of Congo.
  • Paradigm Infrastructure: Founded by ex-American Tower stalwarts Steve Harris, Steven Marshall and Hal Hess, Paradigm Infrastructure is targeting sale and leasebacks in several African markets. Paradigm has been linked to the Airtel Tanzania tower sale and to the new towerco licence process in Egypt.
  • SBA Communications: SBA Communications’ entry into Africa through acquiring Atlas Tower has given the American giant a strong footprint to build upon. It remains to be seen whether SBA Communications expands first within South Africa or elsewhere on the continent through partnerships with other towercos or investors.

Pan African Towers would have made the list, but having lost their CEO to Liquid Telecom Nigeria, there are some uncertainties about where that African towerco goes next. Similarly, Nate Foster continues to operate Atlas Tower outside South Africa, with several sites built in Kenya, but has yet to reach the pace of new build achieved in South Africa; Atlas Tower remains one to watch.

The sale and leaseback drought since 2016 is over. Helios Towers fired the staring pistol on a new phase of M&A in Africa by inking a deal to acquire 1,220 towers in Senegal. Soon after this deal MTN reported it was looking at selling some or all of its 13,000 sites in South Africa; a deal which would be transformational for the South African telecom tower industry.

Now, in March 2020 Helios Towers announces plans to acquire over 2,000 sites from Airtel Africa in Madagascar, Malawi, Chad and Gabon. Helios Towers are in advanced discussions on another 7,500 sites with more in the longer-term pipeline. New acquirers are also popping up, like the aforementioned Paradigm Infrastructure and the low profile Telecom Towers Africa.

Of Africa’s major MNOs, Vodacom retain towers in South Africa, Democratic Republic of the Congo, Mozambique, Lesotho and Kenya through its Safaricom subsidiary. MTN retains towers in Sudan, South Sudan, Benin, Guinea-Bissau, Guinea-Conakry and Liberia, and in eSwatini and Botswana through its subsidiaries. Airtel retains towers in Tanzania, Madagascar, Malawi, Chad and Gabon.

Outside Cote d’Ivoire and Cameroon Orange retains its towers and has no plans to sell to a towerco. In fact, they have been prime instigators of alternatives. Alongside MTN, Orange are Africa Mobile Network’s major client, sending 100s of rural build-to-suit sites to the towerco. And in the DRC and Cameroon they are also working with NuRAN to roll out 1,000s of towers on an OpenRAN basis and managed by an ESCO called ESCOTEL – opting out of the traditional towerco and OEM market altogether.

Orange has also been instrumental in the growth of ESCOs in Africa. While Airtel’s ESCO deal in Gabon was necessitate by a past inability to sell its towers, ESCOs have formed a positive part of Orange’s strategy to retain the sites it considers strategically important while outsourcing the tricky business of power management. Orange recently activated its Cameroon ESCO agreement with Aktivco, its seventh ESCO market, with a deal freshly inked with ESCOTEL in the DRC.

(Pity the Orange Cameroon Relationship Manager, dealing with sites leased from IHS Towers commercially, other sites managed under their Managed with Licence arrangement, 300 sites managed by Aktivco, 240 Africa Mobile Network sites [with perhaps some on an opex basis and some on a revenue share basis] and now sites running NuRAN OpenRAN!)

The energy headaches that confront telecom networks in Africa appear to be relenting somewhat, with Helios Towers reporting material improvements to their bottom line thanks to grid connections in Tanzania and DRC. Similarly, a site connected to a grid which can provide energy for 20+ ours a day becomes the perfect site for hybridisation and battery back-up, enabling towercos to cut out diesel generators and refuelling expenses. Nevertheless, diesel generators and distributed renewable generation are here to stay, especially as Africa continues to add 1,000 of new sites each year.

We continue to wait for IHS Towers’ IPO. After first exploring an IPO in 2018, IHS Towers published a notice in August 2020 that they were looking to list in New York. However, since then there has been little reported from the global towerco giant, in fact, IHS Towers has since acquired another 1,000 sites in Brazil as well as being linked to a tower sale in Oman and the licence process in Egypt. TowerXchange continues to expect IHS Towers to IPO soon, but at present we cannot report when that day will come.

Africa’s strong macroeconomic performance and rapid demographic growth make it a hot spot for telecom investment. Over the next five years Africa’s population is expected to grow at a rate of 2.5%, its economy at 3.5% and mobile subscription growth at 3.1% (Helios Towers Annual Report, 2020). This compares very to favourably to the developed world. Despite struggling through lost decades, Africa has had a strong growth record this century, and its young economies have proved surprisingly resilient to the COVID-shock. These factors are driving the resurgence of sale and leasebacks and the entry of new capital and new teams looking to serve the African telecom tower market.

TowerXchange provides a country by country analysis of tower ownership and market dynamics across 24 of the more active tower markets in sub-Saharan Africa.

Download the report

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