The Public Investment Fund (PIF) and stc group are poised to make significant waves in the telecommunications marketplace with their impending merger of TAWAL and Golden Lattice Investment Company (GLIC). The resultant entity is forecasted to be a major global contender in the telecommunications infrastructure sector, touted to have an enterprise value of $5.85 billion. Fueled by 30,000 mobile tower sites and projected annual revenues of about $1.3 billion, this company will certainly be a titan to watch.
PIF will control 54% of the new entity while stc Group will retain 43.1% ownership. Remaining shares will be held by GLIC minority shareholders. This entire deal, however, is contingent on receiving the standard regulatory approval, which is anticipated in the latter half of this year.
Crucial to the backdrop of this merger is Saudi Arabia’s Vision 2030, a government-launched initiative to bolster “economic diversification, global engagement, and enhanced quality of life.” Per this vision, the telecommunications industry is vital.
As Raid Ismail, Head of MENA Direct Investments at PIF, remarked, “Fast, reliable and accessible connectivity is a key enabler of growth and a cornerstone for society.” This sentiment perfectly aligns with the pursuits of the new company.
Motaz Alangari, Group Chief Investment Officer of stc Group, further emphasized the potential impact of this merger, stating that the unifying of TAWAL and GLIC is a stepping-stone toward “consolidating the Saudi tower market and driving further efficiencies and operational excellence to deliver superior experiences and value for customers.”
Interestingly, this isn’t the first instance of consolidation within the region’s telecom market. Just last year, Ooredoo, TASC Towers, and Zain Group embarked on a journey to integrate their mobile tower operations into an independently owned corporation. This deal, which concluded in December and was valued at $2.2 billion, merged 30,000 tower assets across six countries, including Qatar, Kuwait, Algeria, Tunisia, Iraq, and Jordan.
In summary, the merging of TAWAL and GLIC symbolizes a critical milestone in Saudi Arabia’s Vision 2030, bolsters the consolidation trend in the telecom market and underscores that connectivity remains key to societal growth and development.
