Bharti Airtel Limited (Airtel), a Tanzania based telecommunication services company, has recently reached an agreement with American Tower Corporation (NYSE:AMT), an independent owner, operator and developer of wireless and broadcast communication real estate, for the sale of 1,350 telecom-towers in Tanzania with the possibility to acquire up to 100 additional units that are currently in development.
The agreement seeks to reduce Airtel’s investment in passive infrastructure assets and to promote towers’ sharing to improve operations’ efficiency that will support overall telecommunications sector growth in Tanzania.
The deal reached between both companies regarding telecom-infrastructure in Tanzania, follows a prior agreement signed in 2015 by Airtel for the sale of 4,700 mobile phone towers in Nigeria worth USD 1.05 billion according to Zacks Investment Research.
With the second agreement, Airtel is pleased to strengthen its cooperation with American Tower and also confirms its commitment with Tanzania’s population to improve its operations and bring a world-class service, explained Bharti Airtel Africa MD & CEO, Mr. Christian de Faria.
Airtel is one of the leading companies in the world and Tanzania’s Telecommunication sector, which0 with a young and fast growing population represents a great market potential and attractive opportunity, explained American Tower EMEA EVP & President, Mr. Hal Hess.
According to Airtel, this and prior agreements will help the company to focus on its core business and customers as support debt reduction and capital expenditures (CAPEX) to support expansion in Tanzania.
Airtel is the second largest mobile operator in Tanzania totaling 10.8 million subscribers representing 30% of the market share as of September, 2015, behind Vodacom with 12.5 million subscribers or 35% of the total market share according to the Tanzania Communications Regulatory Authority (TCRA).
According to Reuters, the nearly 36 million subscribers market in Tanzania has a potential to reach 45 million within the next years.
Tanzania currently has a mobile penetration level of 67% which is below the Sub Saharan region’s average of 71.1% according to the World Bank.