Investors look to capitalise on Africa’s increasingly active mobile telecoms
African Infrastructure Investment Managers (AIIM) is looking to invest in a new cellphone tower management company in West Africa said Director Ed Stumpf.
AIIM has already invested in IHS Towers which manages cellphone towers in Rwanda, Zambia, Cameroon, Nigeria and Ivory Coast, following its contribution to a US$450-million investment round for the tower company.
“In the towers space we are pursuing an investment in a new towerco which will pursue opportunities in Nigeria, DRC and Ivory Coast where there is need for 10,000 towers over the next five years,” said Stumpf.
Some African mobile companies are disposing of their cellphone tower infrastructure to companies specialising in the facilities.
According to Tellimer research, African telecommunication companies “are moving towards asset-light models through sale and leaseback agreements of mobile towers” with tower companies.
Airtel Africa recently announced the sale of its towers in Madagascar and Malawi to Helios Towers, as well as entering into an MoU for the potential disposal of about 1,000 towers in Chad and Gabon. MTN Group has also recently appointed advisors to explore a sale and leaseback programme for some or even all of its 13,000 towers in South Africa.
Some African companies are also spearheading infrastructure sharing between mobile operators, a situation that can be better managed by tower companies.
This is an area that AIIM is seeking to tap into by expanding its investments, according to Stumpf.
In the fibre space, the company is now focusing on “metro and last mile terrestrial fibre deployment” having recently invested in South Africa’s MetroFibre Networx.
A December 2020 US$105-million “equity funding round” will be utilised to “support MetroFibre’s capital expansion” over the next three years.
“There continue to be opportunities to enhance connectivity through regulation, helping accelerate downstream demand growth by driving more affordable end user tariffs through promoting competition and infrastructure sharing along different areas of the digital value chain,” explained Stumpf.
He added that “considerable investment is still needed to develop terrestrial networks particularly in the metro and last-mile access areas of the value chain” despite the flurry of current and planned sub-sea fibre landing and connectivity across Africa.