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With most towers sold, local telcos change focus
Indosat Ooredoo Hutchison's sale of towers and other infrastructure announced last week may be the last transaction of that magnitude in the country, as telcos have now largely sold such assets.
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A tower owned by PT Dayamitra Telekomunikasi (Mitratel) is pictured in an undated photograph in Langsa, Aceh. (Mitratel/-)
O
ver the past five years, Indonesian telecommunication service providers have sold thousands of towers and other assets to companies specializing in managing physical infrastructure, allowing the former to focus more on customer services.
Indosat Ooredoo Hutchison (IOH)'s latest transactions with Mitratel and Dhost may be the last major deals in the space.
On Wednesday, publicly listed IOH announced that it had signed an agreement to sell 997 towers to PT Dayamitra Telekomunikasi (Mitratel), a subsidiary of Telkom Group. The deal worth Rp 1.65 trillion (US$108.8 million) puts the average price per tower at Rp 1.65 billion.
According to the agreement, IOH will lease back 983 towers from Mitratel for a 10-year period at Rp 138.6 billion per year.
IOH also sold 633 indoor infrastructure facilities to Dhost in a deal worth Rp 480 billion. The telco will then rent 544 of those back for 10 years, paying Rp 125.4 billion in fees per year.
Both deals are expected to be concluded in the first quarter of this year.
Mohammad Fakhrul Arifin, an equity research analyst at BCA Sekuritas, said the tower deal may be the last one conducted by IOH. "They now have a very [small] number of towers, if [they have] not completely run out," Fakhrul told The Jakarta Post on Friday.
