Etisalat seeking buyers for Zantel Tanzania or for Tanzanian towers

TowerXchange understands that Etisalat is concurrently seeking a buyer either to acquire Tanzanian subsidiary Zantel, of which Etisalat owns 65%, or to acquire the 600-700 towers Zantel has in the region. Standard Chartered have been appointed as Etisalat’s advisors.

Helios Towers Africa would be favourites to acquire Zantel’s towers, if sold separately, as Chuck Green’s pioneering towerco acquired a 60% stake in a joint venture with Millicom-Tigo in 2010, to which Millicom-Tigo’s 1,020 Tanzanian towers were transferred.

Market conditions in Tanzania appear very favourable to the towerco business model. Tanzania has four licensed tier one mobile network operators; Etisalat’s Zantel, Airtel, Vodacom and Millicom Tigo. There’s room for growth in the market – according to the GSMA, Tanzania has 62% mobile subscriber penetration, growing at 4.4% CAGR 2011-2012, with 75.8% population coverage.

Diesel and maintenance costs push opex in Tanzania to a point where the efficiencies offered by the towerco business model makes sense. Tanzania had 4,593 base stations in 2012, a 25% growth from 2011, of which 1,442 were off grid and another half on unreliable grids experiencing power outages of more than six hours per day – statistics again from the GSMA.

Rumours persist that Etisalat is still seeking to sell it’s 3,000 towers in Nigeria, but securing the buy-in of local stakeholders is believed to continue to hold up any potential transaction.

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Etisalat hires Deutsche Bank to sell subsidiary Zantel’s towers in Tanzania – Reports

TMT Finance broke a story that Etisalat had hired Deutsche Bank to lead the sale and outsourcing of Tanzanian subsidiary Zantel’s tower portfolio, which comprises 711 towers located primarily in Zanzibar.

Multiple sources in Tanzania suggest Zantel’s towers are on the market, and the regional nature of the Tanzanian tower network suggests there may still be a healthy market for Zantel’s sites, despite previous transactions in the country, Helios having acquired over 2,400 towers from Millicom-Tigo and Vodacom.

TowerXchange spoke to executives at Deutsche Bank and Etisalat who neither confirmed
nor denied the report. Etisalat are known to favour the appointment of third party advisors to advise on the sale towers, and they have worked with Deutsche Bank previously to advise on a strategic review of its African Atlantique portfolio.

Etisalat are coming to the African tower market late after an abortive attempt to structure a pan-African deal last year. Etisalat now prefers a country by country approach, empowering local their local opcos to lead the process.

Are tower already sold?????

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