PIF, stc Group Ink Deal for Largest Telecom Tower Company in Region

PIF and stc Group have finalized agreements wherein PIF will secure a 51% majority stake in TAWAL from stc Group.

• Subsequently, TAWAL and GLIC will merge to establish the region’s premier telecom tower entity, prioritizing consumer satisfaction.

• The amalgamated company will rank among the world’s largest tower enterprises.

• stc Group’s aim is to reallocate capital while maintaining ownership in strategic assets of significant value.

The Public Investment Fund (PIF) and Saudi Telecommunications Company (stc Group) have formally concluded agreements whereby PIF will acquire a 51% controlling interest in Telecommunication Towers Company Limited (TAWAL) from stc Group. TAWAL stands as the leading telecommunications infrastructure firm in Saudi Arabia and a major player in the regional landscape, with a calculated enterprise value of $5.85 billion as per the agreement terms. Following this acquisition, PIF and stc Group will merge TAWAL with Golden Lattice Investment Company (GLIC), where PIF holds a majority stake, thereby establishing the dominant regional entity in the telecommunication infrastructure sphere.

The resultant entity will be majority-owned by PIF at 54%, with stc Group retaining 43.1%, and GLIC minority shareholders holding the remaining issued share capital.

Completion of the transactions is anticipated in the latter half of 2024, subject to obtaining all requisite regulatory approvals and fulfilling other contractual obligations.

Raid Ismail, Head of MENA Direct Investments at PIF, expressed, “Today’s announcement marks a significant stride in the telecommunications sector of Saudi Arabia and the broader region. Through the integration of GLIC and TAWAL, we are laying the foundation for a unified platform that fosters the growth of the telecommunications industry, enhancing connectivity for communities and businesses alike. This initiative is fully aligned with PIF’s strategic objectives and the Saudi Vision 2030. Accessible and reliable connectivity is instrumental for societal progress and economic growth, and these agreements underscore our commitment to a digitally interconnected future.”

Motaz Alangari, Group Chief Investment Officer of stc Group, commented, “These agreements underscore stc Group’s ongoing commitment to sustainable growth and value creation, leveraging capital efficiently while retaining ownership in strategically significant assets to capitalize on their returns and facilitate expansion into new domains. Today’s announcement resonates with stc Group’s strategic vision and its pivotal role in accelerating the digital transformation of society and the economy in Saudi Arabia and the region. The merger of TAWAL and GLIC represents a significant step towards consolidating the Saudi tower market, driving operational excellence, and delivering enhanced experiences and value to customers.”

The merged entity is poised to revolutionize consumer experience and network coverage, elevating connectivity and mobile internet speeds through the consolidation of Saudi Arabia’s tower assets. Furthermore, it will drive operational efficiencies, foster innovation in the telecommunications sector regionally and globally, and contribute to the establishment of a more streamlined and frictionless business environment.

These agreements underscore PIF’s and stc Group’s commitment to integrating and fortifying the Saudi telecommunication infrastructure sector to unlock its collective potential. This development comes on the heels of TAWAL’s expansion into international markets with the acquisition of infrastructure assets in Bulgaria, Croatia, and Slovenia, positioning this Saudi flagship as the foremost independent tower company in the region. With an estimated 30,000 mobile tower sites and projected annual revenues of around $1.3 billion, the new merged entity is set to become one of the largest tower companies globally.

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