Actis, the London-based global investor in sustainable infrastructure, along with Royal Bafokeng Holdings, has entered into an agreement to acquire a 100 percent stake in Swiftnet, the tower portfolio owned by South African mobile network operator, Telkom SA, for an Enterprise value of approximately $356 million. Telkom SA will sell Swiftnet to a newly created business called Towerco Bidco, which is 70 percent held by Actis, and 30 percent by Royal Bafokeng Holdings.
If the deal goes through, Telkom SA will join rivals MTN South Africa and Cell C in divesting its tower infrastructure to focus on core business operations. Vodacom, a subsidiary of Vodafone Group (NASDAQ: VOD), would remain as the only major South African MNO that still owns its towers.
“This decision marks a pivotal moment in Telkom’s journey towards unlocking shareholder value and streamlining our focus on core business operations,” says Telkom Group CEO Serame Taukobong.
Swiftnet represents a strategic acquisition for Actis which will acquire over 4,000 sites across South Africa. The deal is attractive because Swiftnet already has strong relationships with Telkom SA and other MNO anchor tenants, and long-term contractual revenue commitments.
This acquisition positions Actis to benefit in the growing mobile sector in South Africa that is being driven by strong secular tailwinds of increasing internet access and mobile data demand, and the need for tower densification as MNOs transition from 3G and 4G to 5G. Moreover, Swiftnet has a unique tower footprint across the country and is well positioned to meet MNO demands as they expand coverage in rural areas.
The investment builds on Actis’ existing digital infrastructure portfolio in South Africa. It invested in fiber network operator Octotel in 2020.
The transaction is Actis’ second investment in telecom towers this year. The firm recently acquired a macro tower portfolio in the Western Balkans, comprising roughly 1,800 towers in Serbia, Bosnia and Herzegovina, and Montenegro.
“Our strategy is to position Swiftnet as the leading independent towerco in this market,” comments David Cooke, Partner at Actis. “Providing the infrastructure to deliver universal telecommunications access across the country, including the roll-out of 5G connectivity, presents great growth prospects. Our deep understanding of the region and our global network of tower expertise provide the basis to create a strong performing platform with scale-up opportunities.”
By John Celentano, Inside Towers Business Editor
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