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Business deals

Myanmar's Irrawaddy Green Towers stake sale looks imminent

Shortlist includes Malaysia's edotco Group and private equity funds, sources say

With strong adoption of mobile phones, Myanmar has seen a mushrooming of telecom towers, with the sector ripe for consolidation. (Photo by Yuichi Nitta)

SINGAPORE -- The sale of a stake in Myanmar-based telecom tower company Irrawaddy Green Towers has reached an advanced stage, with a deal likely to be sealed as soon as this month, three people with knowledge of the matter told DealStreetAsia.

The company has shortlisted three bidders, including two private equity funds and a strategic player, Malaysian telecoms infrastructure provider edotco Group, one of the people said.

A spokesperson for edotco Group said the company was unable to comment at this point. However, as per its expansion strategy, edotco was always open to potential opportunities, it said in response to queries.

Edotco, a subsidiary of Malaysian telecom company Axiata Group, is believed to own and manage a total of 3,120 telecom towers in Myanmar. The company first entered Myanmar following the acquisition of a 75 per cent stake in Digicel Myanmar Tower in December 2015.

The other telecom tower operator in Myanmar is Apollo Towers, which was founded by global private equity major TPG Capital, along with Sanjeev Ahuja, former CEO of France-based Orange Group, and Africa-based Eaton Towers.

The IGT stake sale process has been in the works since the middle of 2019 as its private equity shareholders have been seeking to make a complete exit, as previously reported by DealStreetAsia. International advisory firms Standard Chartered and UBS are the sell-side advisers.

IGT is owned by Singapore-based holding company Irrawaddy Tower Asset Holdings, which is backed by Dubai-based Blue Stone Management and Lebanon-based investment firm M1 Group.

The company's shareholders are looking to monetize their investments as Myanmar has seen a mushrooming of telecom tower businesses, especially small tower operators, and the sector is ripe for consolidation.

IGT, Bluestone Management and M1 Group did not immediately respond to requests for comment.

Established in 2014, IGT claims to be the largest telecom tower company in Myanmar serving the major operators including Telenor, Ooredoo, MPT and Mytel, according to its website.

In 2015, IGT received a $122 million financing package from Dutch development bank FMO to enable it to build and operate about 2,000-3,000 telecom towers across Myanmar.

The financial package comprised a subordinated loan of $13 million with a nine-year tenor and a long-term senior loan of $109 million with a tenor of eight years. The senior loan was syndicated from European development finance institutions including Germany's DEG, France's Proparco, UK's CDC Group, Belgium's BIO and Austria's OeEB.

Aside from FMO, IGT also received $60 million of debt and equity investment from International Finance Corporation in 2016 for tower acquisition and construction. IFC also committed to mobilizing a potential parallel senior debt financing of another $30 million to support Irrawaddy's $490 million tower development project.

For the original story from DealStreetAsia, click here.

DealStreetAsia is a financial news site based in Singapore that focuses on corporate investment activity in Southeast Asia and India. Nikkei recently announced the acquisition of a majority stake in the company.

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