Africa’s telecom tower firm Eastcastle Infrastructure has secured $130 million (R1.8 billion) to pursue new build-to-suit telecom tower and related infrastructure opportunities initially in Nigeria, the Democratic Republic of Congo and the Ivory Coast for their core existing MNO relationships.
The company was established in 2020 by Peter Lewis, the former Group CFO and Pankaj Kulshrestha, the former Group COO of Eaton Towers.
The funding has been made available by the African Infrastructure Investment Managers (AIIM), one of Africa’s largest infrastructure-focused private equity fund managers, Adenia Partners (Adenia), a private equity firm investing in Africa, and IFC, a member of the World Bank Group.
The funding will support Eastcastle’s build-to-suit strategy, to develop new telecom towers initially in the Democratic Republic of Congo, Nigeria and Côte d’Ivoire. The number of towers across the region needs to increase significantly to accelerate the deployment of bandwidth-intensive technologies such as 3G, 4G and 5G by Mobile Network Operators and to increase quality connectivity for individuals and businesses.
The deal comes as growth in data consumption across Africa is soaring, with data consumption per subscriber expected to increase fourfold by 2025, along with an expected 200 million new mobile Internet users. Mobile operators that use bandwidth-intensive technologies, such as 3G, 4G and 5G are expected to account for more than 85% of connections by 2025, compared to around 38% in 2017. The growth in smartphone adoption in Africa is another factor leading to increasing demand for data, with smartphone usage set to rise to 65% of connections in 2025, up from 44% today.
“Following the success of Eaton Towers, Pankaj, myself and the team are excited by this opportunity to again be of service to our long-standing African Telecoms clients. We are especially pleased by the strong investor support received from some of the most experienced investors in African Towers and Infrastructure,” Peter Lewis, co-Founder of Eastcastle said.
The consortium’s advisors for the transaction were Clifford Chance (legal) and Deloitte (tax). The sponsor’s advisors were Norton Rose (legal) and Hardiman Telecommunications (Commercial). AIIM will initially have two representatives on the board of Eastcastle: Ed Stumpf and Martin Edge, senior digital infrastructure advisor for AIIM. Adenia’s representatives will be Stephane Bacquaert and Charles Boatin.
AIIM has recently acquired a 25.8% interest in MetroFibre Networx (Pty) Ltd alongside a consortium of existing MetroFibre Networx shareholders in South Africa.