Veon Ltd, the Dutch-based operator of telecommunications networks, is in advanced talks to sell its tower assets in Pakistan, Bloomberg reported Tuesday.
Veon’s Group Chief Executive Officer Kaan Terzioglu said in an interview that the sale process is very close to the conclusion. The company has 10,000 to 12,000 towers in Pakistan.
According to Terzioglu, the value of one tower is somewhere between $60,000 to $80,000 depending on interest rates. This means that the company values its tower assets in Pakistan anywhere between $600 million to $960 million.
According to Bloomberg, a Saudi Telecom Co. unit, a consortium between Pakistan’s TPL Corp. and UAE-based TASC Towers, and Pakistani conglomerate Engro are among the bidders for the towers.
None of the companies reportedly interested in acquiring the towers have made an official comment on the potential deal.
It is pertinent to mention here that TPL REIT Management Company Limited, a wholly-owned subsidiary of TPL Properties Limited, entered into a strategic partnership with UAE-based TASC Towers for the acquisition of a Telecom Tower Infrastructure Company through an Infrastructure Real Estate Investment Trust (REIT) back in September.
According to a stock filing at the time, TPL RMC and TASC have participated as a consortium in an auction process for the acquisition of a Telecom Tower Infrastructure Company through an Infra REIT subject to receipt of all relevant approvals and consent from the regulatory authorities.
Veon was founded in Moscow in 1992 as VimpelCom. It has since grown into a Dutch-domiciled telecommunications giant with more than 217 million customers in nine countries. The firm recently started the process of selling its Russian unit, where it is the country’s biggest mobile operator. The company’s share price has fallen by two-thirds this year due to the fallout from the Ukraine war.
Story of the collapsed deal
Veon and Global Telecom Holding (GTH) signed an agreement for the sale of its tower business in Pakistan for approximately $940 million back in 2017.
Under the agreement, Veon and GTH’s subsidiary in Pakistan, Jazz, was to sell its wholly-owned tower company, Deodar, with a portfolio of approximately 13,000 telecommunication towers to Tanzanite, a tower operating company owned by Malaysia’s edotco Group and Dawood Hercules Corporation. However, the deal was scrapped in 2018 after a protracted approval limbo.
It will be interesting to see if the company is successful in getting the necessary regulatory approvals for closing the potential deal this time around.
