US fund buys Kenyan cell tower company

By BRIAN NGUGI
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Summary

• The companies did not disclose the size of the majority stake sold to Everstrong Capital, which has offices in the United States, Kenya and South Africa and is targeting deals in energy, water , ICT, transport and health.
• As part of this agreement, Everstrong, through its local fund called Kenya Infrastructure Fund, will inject part of 12.5 million dollars (1.4 billion shillings) to finance the construction of 200 additional towers.

US private equity fund Everstrong Capital has taken a majority stake in SealTowers Limited, a Kenya-based independent cell tower provider founded five years ago, the companies announced yesterday.

The agreement is subject to regulatory approvals. The companies did not disclose the size of the majority stake sold to Everstrong Capital, which has offices in the United States, Kenya and South Africa and is targeting deals in energy, water , ICT, transport and health.

As part of this agreement, Everstrong, through its local fund called Kenya Infrastructure Fund, will inject part of 12.5 million dollars (1.4 billion shillings) to finance the construction of 200 additional towers.

“We believe the partnership with Everstrong Capital will enable us to tap into tremendous opportunities in the telecommunications sector in both urban and rural areas,” SealTowers founder and chief executive Tony Monda said in a statement.

“The expansion of 4G and 5G networks will require many more filler tower sites to support the networks. In addition, large buildings, shopping malls, commercial and educational establishments provide an opportunity for indoor network solutions and provide expansion opportunities for SealTowers.

Everstrong earlier announced that it has raised $50 million (5.6 billion shillings) from institutional investors targeting infrastructure projects in Kenya and Africa.

“We are delighted to announce this investment in SealTowers Limited and look forward to helping expand network access across the country,” said Philip Dyk, Managing Partner of Everstrong Capital.

Launched in 2016, SealTowers aims to build, own, lease and manage telecom towers and infrastructure for Kenyan telecom operators.

The company says it has entered into framework, build and lease agreements with five unnamed mobile and internet service providers in Kenya, allowing them to host telecommunications equipment on its infrastructure.

Telecom operators are in a race to expand their coverage of fourth-generation (4G) cellular broadband technology to attract and retain subscribers using smartphones.

Mobile network operators are increasingly turning to renting towers from independent providers that can serve multiple customers, allowing telecom operators to reduce costs and focus on acquiring and serving subscribers with various services.

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