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Tower Talk: a guide to the latest major cell site developments

15 Nov 2016

Zain Saudi Arabia is expecting to sell its portfolio of 7,776 mobile towers for more than USD500 million in H1 2017, according to Scott Gegenheimer, the CEO of the operator’s Kuwait-based parent company. quotes the official as saying that the company has narrowed its prospective buyers down to two bidders, and that the deal is likely to be finalised ‘sometime in the next two quarters.’ The CEO went on to say that the operator would use the proceeds from the sale to pay down its debt and for investments in data services. Further, the cellco – which has not registered a quarterly net profit since its launch in 2008 – is now ‘probably looking at 2018 for profitability,’ Mr Gegenheimer added.

US-based infrastructure group American Tower Corp (ATC) has unveiled plans to expand into Argentina, with the company already present in Latin America through operations in Brazil, Chile, Colombia, Costa Rica, Mexico and Peru. In a Securities and Exchange Commission (SEC) filing, the group noted that it has entered into an agreement to acquire a ‘portfolio of urban telecommunications assets … including wireless sites, equipment and fibre assets located on utility infrastructure as well as a number of indoor wireless sites.’ ATC expects to close the deal by the end of 2016, subject to it receiving the necessary regulatory approvals.

Vietnam Infrastructure (VNI) has delayed the planned sale of its entire 100% shareholding in Southeast Asia Telecommunications Holdings (SEATH), which in turn owns 100% of three Vietnamese tower companies, to Malaysia’s OCK Group for USD50 million due to the complexity of closing the process, writes. The transaction was originally expected to be completed by the end of October, but is now scheduled to close before the end of the year. Tony Hsun, the managing director of infrastructure at VNI’s parent, VinaCapital explained: ‘since this is a transaction involving multiple levels of regulatory processes in Singapore, Malaysia and Vietnam, it has taken longer than we initially anticipated.’ SEATH holds 100% of VNC-55 Infrastructure, Mobile Information Service, and Global Infrastructure Investment, with the trio owning and operating a combined total of 1,938 telecom towers throughout Vietnam.

Malaysia’s edotco Group, a subsidiary of Axiata, has exercised a call option to increase its holding in edotco Myanmar – known as Myanmar Tower Company (MTC) prior to edotco’s acquisition of a 75% stake in the company in December 2015 – to 87.5%. The Edge Markets writes that the group will purchase the 12.5% stake from Singarpore-based Yoma Strategic Holdings (YSH) for USD35.00 million. As part of edotco’s initial purchase in 2015, the two groups agreed a put and call option for the sale and purchase of the remaining 25%, fixing the price at the higher of USD40.25 million or an agreed multiple of edotco Myanmar’s twelve-month EBITDA. Although edotco is only exercising half of the options, the remaining options will be terminated once the transaction is completed.

In other edotco news, the Bangladesh Telecommunications Regulatory Commission (BTRC) has approved the Malaysian group’s plans to alter the shareholding structure of its operations in Bangladesh. Under the plan edotco will buy back 31.01% of the shares in edotco Bangladesh from sister company and mobile provider Robi Axiata, which currently holds a 51% stake in the tower unit. The transfer will lift edotco’s holding to 80.01%, whilst Robi will retain the remaining 19.99%.

Italian infrastructure provider EI Towers has booked total revenue of EUR187.93 million (USD203.9 million) for the nine months ended 30 September 2016, a 4.3% increase y-o-y. EBITDA for 9M 2016, meanwhile, was EUR89.35 million, up from EUR81.781 million the previous year. Net profit for the period grew by 16.1% y-o-y to EUR36.22 million.

Telecom Italia’s wireless infrastructure arm, Infrastrutture Wireless Italiane (INWIT), has registered a 5.1% increase in third-quarter revenue, booking turnover of EUR83.9 million for the three months ended 30 September 2016. The operator broke down its revenue as follows: EUR63.3 million from its Master Service Agreement with Telecom Italia; EUR19.9 million from other customers, including mobile service providers and radio network operators; and EUR700,000 from hosting on new sites. EBITDA for the period totalled EUR41.7 million, up from EUR36.2 million in Q3 2015, with an EBITDA margin of 49.7%: INWIT attributed the growth to an increase in the number of tenants on its sites and a reduction in leasing costs. Net profit, meanwhile, was EUR25.1 million, an increase of 15.7% y-o-y from EUR21.7 million in the same period of 2015.

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