Batelco scraps tower sale in Bahrain, Jordan
Manama, May 14, 2012
Bahrain Tele-communications (Batelco) has scrapped plans to sell its transmitter towers in Bahrain and Jordan and will instead look to share infrastructure with rival operators, the former monopoly's chief exective said on Monday.
In December, a source told Reuters that Batelco was considering a sale and lease back deal for its towers in the two countries, with funds raised earmarked for future acquisitions.
'Batelco has decided not to proceed with any tower sale in Bahrain and Jordan as various sale and lease back proposals did not create sufficient, long-term economic value,' Sheikh Mohamed Al-Khalifa said in an emailed statement.
The government-controlled firm owns Jordanian mobile operator Umniah, 27 percent of Yemeni mobile operator Sabafon, minority stakes in internet providers in Kuwait and Saudi Arabia and is also active in Egypt.
Batelco, which secured investment-grade ratings in November, has cash and bank balances of 61.8 million dinars ($163.93 million) according to its first-quarter results.
This means Batelco 'has the ability to raise funds at much lower rates than tower companies and thus could not justify the lease back arrangements', Sheikh Mohamed said.
Batelco will instead look to share towers and other infrastructure with rival operators.
In Bahrain, it competes with Viva, an affiliate of No. 1 Gulf operator Saudi Telecom, and Kuwait's Zain , which also operates in Jordan along with Jordan Telecom, majority-owned by France Telecom.
'As more towers, rooftops and indoor solutions will be required in the future, such co-operation between operators will increase,' Sheikh Mohamed added.
Fierce domestic competition has been a major factor in Batelco reporting declining profits in seven of the past eight quarters. In April, Sheikh Mohamed told Reuters that Batelco aimed to make at least one acquisition in 2012 to offset falling home revenue. - Reuters