- Transaction involves only the physical infrastructure
- Deal approved by Kuwait’s CITRA and supported by KDIPA
Kuwait City: In a regional first, Zain Group, the leading mobile telecom innovator in eight markets across the Middle East and Africa, announces that its flagship operation in Kuwait has completed the sale and leaseback of the passive physical infrastructure of its 1,620 mobile tower portfolio for US$130 million (KD 40 million) to IHS Holding Limited (IHS). The transaction is the first sale and leaseback of telecom towers in the Middle East region by a licensed mobile operator.
The transaction valuation was aimed at helping Zain to maximise efficiency in its operating model, taking into account future lease terms and the expansion of 5G towers across Kuwait. Under the terms of the transaction, Zain is selling only its passive, physical infrastructure to the new entity and will retain its intelligent software, technology and intellectual property with respect to managing its network.
The transaction has been formally approved by Kuwait’s Communication and Information Technology Regulatory Authority (CITRA), whose pro-active policies for the telecom sector are in line with new Kuwait Vision 2035. Furthermore, the deal was championed by the Kuwait Direct Investment Promotion Authority (KDIPA), which played a key role in attracting the foreign investment and facilitating the transaction process.
Bader Al-Kharafi, Vice-Chairman and Group CEO of Zain said, “This historical transaction unlocks value for shareholders as it gives us greater flexibility to focus on higher yielding digital investments, 5G expansion and operational efficiencies in Kuwait. It also supports Zain’s transformational strategy in becoming a digital lifestyle provider through optimizing service delivery and enhancing customer experience.”
Al-Kharafi added, “I’m very proud of the Zain team for its professionalism in completing this first agreement of its kind in the MENA region. I’m also very appreciative of the positive support of both CITRA and KDIPA which were instrumental in making this deal happen. We are confident we have chosen the right partner in IHS, a company that possesses high caliber expertise with sound operational experience in diverse markets.”
Sam Darwish, Chairman and Group CEO of IHS commented, “We are delighted to have successfully concluded this transaction with Zain and look forward to a long and successful partnership over the coming years in Kuwait and potentially beyond.”
© Press Release 2020