Mobile towers M&A and outsourcing deals predicted across Europe and Africa

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25 February 2013

Telecom experts are forecasting a surge in mobile infrastructure deals this
year, as more operators around the world look to streamline operations and
raise capital by selling off and outsourcing mobile tower portfolios.

Telecom chiefs and sector heads of leading finance and advisory businesses
are meeting in London on March 14 for TMT M&A Forum 2013, to discuss the
latest opportunities and strategies.

“There has been a tremendous amount of activity in the infrastructure sector
around the world since last year’s conference, in particular in Western
Europe,” commented expert telecom adviser John Graham, partner at Clifford
Chance, who will be chairing the Mobile Infrastructure Panel at the
conference.

“A number of major carriers executed market first sale leaseback
transactions in Western Europe during 2012, including Telefonica in Spain,
Bouygues in France and E-Plus in Germany. Other carriers can be expected to
follow. In Uganda alone, three (MTN, Orange and Warid) of the four carriers
sold their towers during 2012,” said Graham.

Declining voice revenues will continue for operators, forcing tough
decisions ahead, said Eric Benedict, Managing Director, Alix Partners, who
is chairing the CFO Round Table at the TMT M&A Forum. “The rollout of LTE
and ongoing high levels of capex spend will still need to be financed,
putting pressure on the ability generate historic levels of cashflow.
Looking forward, the key trends for the sector will continue to be the
sharing or outsourcing of infrastructure assets, asset disposals, as well as
refinancing in the buoyant bond and high yield markets to lower costs of
capital,” he said.

“With EBITDA margins expected to continue to move down, operators will have
to take more costs out and develop smarter ways of pricing to reflect the
real underlying profitability of customer segments, products and services.
Operators will need to follow other sectors that have been through similar
restructuring challenges and look at where they focus. This will require
them to be even more disciplined in investment decisions going forward” said
Benedict.

Also joining the CFO Round Table session are: Wolfgang Kniese, CFO, T-Mobile
Austria; Andres de Orleans Borbon, CFO, Helios Towers Africa; Catherine
Birkett, Chief Financial Officer, Interoute; and Khalid Ellaicy, Group CFO,
Orascom Telecom Holding.