• HH Prince Nayef: “Divestment of more than 8,100 towers creates shareholder value as it reduces debt obligations”
• Eng. AlDeghaither: “The deal unlocks capital and resources, allowing us to focus on our core operations and to further invest in technological upgrades”
• Agreement involves a lease back period of 15 years with a 5-year renewal option and building of an additional 1500 towers over the next 6 years.

Riyadh, 28 November 2018

Zain Saudi Arabia (Zain KSA) announced that its Board of Directors had accepted HIS Holding Limited’s offer to sell and re-lease its communication towers.  Zain KSA stated in a press release that the offer consists of selling more than 8,100 mobile telecommunication towers located in prime and strategic locations across the Kingdom (covering 98% of populated areas) for 2.43 billion SR.

The Company then further explained that the offer presented by IHS Holding Limited, which is considered to be the largest cell tower operator in the markets of  Europe, Middle East and Africa and the third largest independent tower company in the world, is still underway to reach a final approval and to set out regulatory guidelines for the Communications and Information Technology Commission and for the  other concerned parties as well, while taking into consideration that the offer in question is only limited to the structure of the tower and that the telecommunications antennas along with all other equipment shall therefore remain the property of Zain Saudi . Zain is selling only its passive, physical infrastructure to IHS and will retain its intelligent software, technology and intellectual property with respect to managing its network. The agreement also involves a lease back period of 15 years, with a 5-year renewal option and building of an additional 1500 towers over next 6 years.

The transaction is awaiting a final agreement between the parties involved along with an approval requirement from the Kingdom’s Communications and Information Technology Commission (CITC), as well as an approval from the lenders.

Commenting on this important development, His Highness, Prince Nayef bin Sultan bin Mohammed bin Saud Al-Kabir, Chairman of Zain Saudi Arabia, said, “The sale of Zain KSA’s impressive tower network is a highly positive move, as it creates shareholder value by helping the company reduce its debt position, considering the proceeds will be injected into future investments with more lucrative RoI. Both the Zain Saudi Arabia’s Board of Directors and Zain Group executive management are confident that we have chosen the right partners in IHS, a company that possesses high caliber expertise with a sound operational experience in diverse markets.”

HH Prince Nayef continued, “We recognize and appreciate the efforts made by the CITC in keeping abreast with global trends in the telecommunications’ sector by offering licenses to provide wholesale services for Tower infrastructure, thereby reducing capital expenditure challenges on telecom operators and raising the efficiency of mobile networks. This proactiveness also allows new investors to enter the market, thus creating more employment opportunities. These efforts by the CITC that complement our deal with IHS, enhance our mission to play our contributory role in the achievement of the Kingdom’s 2020 National Transformation Program and Vision 2030 Economic ambitions.”   

Eng. Sultan Bin Abdulaziz Al Deghaither, Chief Executive Officer of Zain Saudi Arabia said, “We have implemented a transformation program in the Kingdom for some time now and advanced our efforts to become a digital lifestyle provider. The deal unlocks capital and resources, allowing us to focus on our core operations and to further invest in and deliver the latest ICT technologies to meet the ever-increasing demand for reliable broadband access and data consumption. It also provides us additional impetus to focus on the delivery of more data monetization initiatives and customer enhancing services in order to offer our customers the best data experience in the Kingdom.”

This value -creating agreement with IHS coincides with the celebrations of the tenth anniversary of Zain’s commercial operation in the Kingdom, and comes on the back of the impressive third quarter 2018 results achieved by Zain Saudi Arabia- its best-ever quarterly results since its establishment. The progress achieved by Zain Saudi Arabia in implementing the company's transformation strategy, saw the company recently make an early voluntary payment of SAR 600 million for its Murabaha financing agreement, portraying the company’s solid cashflow.

END