Helios Towers has entered the South African market by forming a partnership with Vulatel to expand mobile and fixed line infrastructure in the country. Helios Towers plans to make “major greenfield wireless and fixed-line telecoms infrastructure investments” there. Helios Towers expects South Africa to lead the 5G roll-out in sub-Saharan Africa. Helios Towers South Africa (HTSA) will build open access infrastructure that it will then lease to other companies.

TechCentral said Helios Towers has earmarked USD 100 million to spend on infrastructure in South Africa in the next three to four years. CEO Kash Pandya revealed the figure after announcing the deal with majority black-owned Vulatel. Helios Towers will own 66 percent of Helios Towers South Africa (HTSA), with Vulatel holding the remaining 34 percent, Pandya said.

There are 30,000 towers in South Africa and less than 10 percent of them are with independent tower companies. Pandya said Helios has been “on the ground” in South Africa for the past year, building relationships and considering the optimal way of entering the market.

Vulatel is led by CEO and Chairman Tlhabeli Ralebitso, who was the founding MD of Vodacom Ventures and previously led Vodacom Group’s M&A and investor relations functions. Vulatel’s MD, Jean-Pierre Crouse, used to be chief implementation officer at Dark Fibre Africa.

Vulatel began operations in 2017 after acquiring Dimension Data’s fibre and wireless division (formerly Plessey South Africa). Helios Towers operates about 6,500 towers in Tanzania, the Democratic Republic of Congo and Congo-Brazzaville, and has urban operations in Ghana. Helios said it has long considered South Africa an attractive opportunity due to the size of its economy, its population dynamics and the demand for advanced telecoms services.

The company’s investors include Helios Investment Partners, Quantum Strategic Partners, Albright Capital Management, RIT Capital Partners, International Finance Corporation and Millicom International Cellular. Pandya said Helios evaluated several potential partners in South Africa before settling on Vulatel. He praised Vulatel’s management team and its knowledge of the South African telecoms sector.

Pandya would not speculate on plans by other South African mobile operators to sell their tower portfolios but said it would make sense for them to do so. Up to now, only Cell C has offloaded its tower assets, to American Tower. Pandya said it makes sense for them to do so as they can then invest the money in new technologies and expanding their market share.

Bloomberg speculated that establishing a towers business in South Africa could help pave the way for an initial public offering. Helios Towers and two African rivals were forced to abandon share-sale plans last year. Helios and its peers are desperate to raise cash for expansion across Africa countries, said Bloomberg, where the emergence of 5G networks and accelerating broadband take up presents a growth opportunity.

Source: TelecomPaper

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