Sales of telecom towers in Oman and other geographies where majority Omani-government-owned Omantel has a presence through its Zain telecom subsidiary, will culminate in the establishment of one of the largest telecom tower companies in the region, a top official has revealed.

Talal al Maamari, CEO – Omantel, said the initiative – first launched in 2021 with the sale of thousands of its telecom towers in the Sultanate of Oman – has since been expanded to cover Zain-linked infrastructure in Saudi Arabia, Jordan and Kuwait, and will be enlarged to include Zain towers in Bahrain, Iraq and Sudan as well. Significantly, the exercise will unlock an estimated $1.6 billion in value, which will be ploughed into Omantel’s long-term growth projects, he stated.

“Unlocking value over the last 12 months, we have announced a number of initiatives that are part of our goal to remove anything that is noncore from our portfolio,” Al Maamari said.

“So the tower deal that you’ve heard about here in Oman, and in KSA, Kuwait and Jordan etc are basically part of these initiatives. So far, we are unlocking approximately USD 1.6 billion worth of value. And we have an ambition to continue with Zain Bahrain, Zain Iraq and Zain Sudan, thereby establishing one of the largest tower companies in the region,” he added in a presentation to investors during a forum hosted by Muscat Stock Exchange (MSX) recently.

Telecom towers are part of an operator’s passive telecom infrastructure that falls outside of the scope of the company’s regulated assets. By selling these towers to a specialist tower entity, the latter can then offer the same infrastructure to other operators on lease arrangements, thereby providing value to all stakeholders concerned.

Last year, Omantel – a subsidiary of Oman Investment Authority (OIA) – entered into an agreement with UK-based Helios Towers to sell its passive tower infrastructure portfolio of 2,890 sites for a cash consideration of $575 million and representing an enterprise value of $615 million.

The deal has resulted in the establishment of a new joint venture holding company owned 70 per cent by Helios Towers and the balance 30 per cent by Muscat-based Rakiza Telecommunication Infrastructure. The latter is a wholly owned subsidiary of Oman Infrastructure Fund (Rakiza Fund), a fund that is co-managed by the Oman Infrastructure Investment Management (OIM) and Equitix.

The transaction will enable Helios Towers to establish a presence in the Middle-East region and become a leading independent tower infrastructure provider in Oman.

Importantly, the proceeds from the tower sales are being re-allocated towards Omantel’s long-term growth, Al Maamari said in his presentation. “Over the journeys of both Omantel and Zain, we have invested in many companies that complement the ICT ecosystem. Some of the highlights are the Oman Data Park, which was initially started as a data centre company, but is today a SaaS (software as a service) company that delivers many cloud services targeting the domestic market of Oman.”

Global data infrastructure leader Equinix, in a 50:50 joint venture partnership with Omantel, has set up a data centre in Barka and has just announced plans for a second data centre in Salalah, said Al Maamari.

Further, to consolidate its B2B offerings, Omantel subsidiary Zain Tech has been launched with an eye on multinational and regional organisations. Service offerings include blockchain, fintech and MVNOs, he added.

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