Qatar-based multinational telecom company Ooredoo’s portfolio company PT Indosat Tbk (Indosat Ooredoo) has signed a sale and leaseback agreement with PT EPID Menara AssetCo, an Indonesian subsidiary of Edge Point Singapore, for more than 4,200 telecommunications towers.
Edge Point Singapore is wholly owned by Digital Colony, a leading global digital infrastructure investor with extensive experience owning and operating cellular towers.
Indonesia-headquartered Indosat Ooredoo has agreed to sell this tower portfolio for $750 million, including a supplementary offer, making it one of the largest deals of its kind in Asia. The sale will free up capital to create value for shareholders while also maintaining Indosat Ooredoo’s strong growth momentum through network performance improvements and the launch of innovative new digital solutions in order to improve the customer experience.
Furthermore, the sale is part of Ooredoo Group’s strategy to move to a more efficient and flexible asset-light model, as well as to unlock the trapped value of its infrastructure portfolio. Before this transaction, Ooredoo had a global portfolio of approximately 27,000 owned towers, representing a significant infrastructure portfolio for the Group.
“This sale and leaseback agreement aligns perfectly with our new strategy and its focus on creating more value for shareholders and customers. This strategy incorporates a shift towards an asset-light model that will help us unlock significant capital and enable us to focus on our core mission of delivering outstanding digital and enterprise services to our customer base. I extend our gratitude to the Government of Indonesia for its progressive policies that leave a positive impact on the industry, its operators, and its people.”
Edge Point Indonesia was declared the winning bidder of a competitive tender process conducted by Indosat Ooredoo. The deal is expected to close in the second quarter of 2021, subject to customary conditions, including shareholder approvals by Indosat Ooredoo.
The company will lease back space on the towers for ten years to meet its ongoing requirements. US-based global leader in financial services, J.P. Morgan acted as financial advisor to Indosat Ooredoo.
“This deal will further our strategy to create more value from our infrastructure assets. It marks the third and final sale of assets from our high-quality tower portfolio and continues our transition into a leading digital telecoms company. We are confident the leaseback agreement, with its attractive terms, will continue to meet our ongoing tower needs, while the capital that we have unlocked will provide further fuel to power our growth momentum,” said Ahmad Al Neama, President Director and Chief Executive Officer of Indosat Ooredoo.