Batelco looks at selling towers to raise over USD200m acquisition capital

5 Dec 2011

Bahrain Telecommunications Company (Batelco) is examining a plan to sell and lease back its mobile network tower infrastructure in Bahrain and Jordan to raise funds for foreign acquisitions. The group has hired Citigroup to assist with a tower sale which could raise between USD200 million and USD300 million, a banking source was quoted by Gulf Daily News as saying. The source added that Batelco had already received expressions of interest from potential bidders. Batelco’s chief executive of strategic assignments, Peter Kaliaropoulos, confirmed that the Bahraini group was exploring options to monetise tower infrastructure in both countries, saying: ‘We are exploring all options to unlock value for our business and the towers is one of those options, but we have not made a decision on whether to lease them back or keep them – we are still going through the deliberations… We have no debt, so extra funds we derive – should we proceed with monetising the towers – will go towards future acquisitions because it reduces the cost of funding for us.’ Batelco, with a cash and bank balance of USD230 million as of 30 September 2011, may also issue bonds to raise financing for acquisitions. TeleGeography’s GlobalComms Database notes that the small Bahraini telecoms sector is by and large saturated, driving Batelco to enter other markets, but whilst its group subscriber base surpassed eleven million in seven countries by the end of September 2011, it has underachieved in international acquisitions recently – the main reason for its current debt-free status. The company had planned to derive 70% of consolidated turnover from operations outside Bahrain by the end of 2010, but in the first nine months of 2011 only 37% of its net revenues came from foreign operations.

Bahrain, Jordan, Bahrain Telecommunications Company (Batelco), Umniah