Omantel is said to explore a $500m sale of tower network

Oman’s biggest phone company is weighing the sale of its tower network, a deal that may fetch about $500m, according to people with knowledge of the matter.

State-controlled Oman Telecommunication Co., valued at OMR474m ($1.2bn), is seeking to sell about 3,000 towers in the sultanate, the people said, asking not to be identified because the information is private.

The transaction will probably attract telecommunications companies with businesses in the region as well as private-equity firms, they said.

Carriers are offloading towers in emerging markets across the Middle East and Africa to reduce the burden of costly infrastructure.

South Africa’s Telkom SA SOC is weighing a potential sale of 6,500 towers, while Saudi Telecom is considering options for its roughly 17,000 towers, including a sale or merger. Zain sold 1,620 telecom towers to IHS Holding for $130m earlier this year.

Wireless infrastructure has been drawing interest from investors attracted to the steady, long-term nature of the assets. A report co-authored by consultancy EY in April 2019 found that greater outsourcing by telecom operators of their tower assets could release EUR28bn ($33bn) of capital for reinvestment.

A potential sale could also help Omantel strengthen its balance sheet and preserve cash. It reported a 28 per cent drop in first-half profit, hurt by a sharp slowdown in economic activity caused by the coronavirus pandemic.

Discussions are still ongoing and there’s no certainty that the deal would be completed, said the people. A representative for Omantel couldn’t be reached immediately for comment.