Oman’s first and leading telecom company, Oman Telecommunications Company (Omantel) has entered into an agreement to sell its passive mobile tower infrastructure assets to UK-based independent telecommunications infrastructure company Helios Towers for $575 million.
Under the terms of the agreement, Omantel will sell only its passive mobile infrastructure assets in the Sultanate, which include 2,890 towers, and will enter into a long-term master services agreement to continue to use the tower assets.
According to the company statement, “Against the service fee to be paid to Helios Towers, Omantel will eliminate certain direct network operating costs and through the build-to-suit arrangement avoid passive infrastructure capex for new sites. Besides, utilization of sale proceeds for debt reduction will lead to finance cost savings.”
Omantel will retain full ownership and control of its active network and spectrum as well as its software, technology, and intellectual property concerning managing its networks.
The sale of the passive tower infrastructure is consistent with the company’s strategy of developing world-class asset-light, strategic, and advanced communications networks in Oman while maximizing the value and efficiency of the shareholders, customers, and partners, as per the company.
“This strategic partnership invites Foreign Direct Investment (FDI) in Oman, supporting Oman as a leading FDI destination in the GCC while creating jobs and opportunities in the country. This move also allows the monetization of our towers at highly attractive valuation levels, de-lever our balance sheet, and will accelerate network development in next-generation advanced technologies while enabling management to focus on innovation and product development while outsourcing non-core infrastructure management to a world-class infrastructure management firm – Helios Towers. We are excited to enter into this transaction and long-term strategic partnership with Helios Towers who have impressed us with their high level of expertise, interest, and partnership credentials.”
Kash Pandya, Chief Executive of Helios Towers said, “Through the acquisition, which establishes us as a leading tower operator in Oman, we expect to achieve our Group target of 12,000+ towers well ahead of plan, while also strengthening our business through further hard-currency revenues and diversification into one of the fastest-growing markets in the Middle-East.”
The agreement calls for the sale of 2,890 mobile towers with a 15-year lease and service contract with renewal options. Helios Towers has also committed to constructing at least 300 new towers over the next seven years, the company added.