Aug 17, 2015

Apollo Towers Gets $30-Million Equity Boost from Myanmar Investment Ltd

Apollo Towers Myanmar Ltd said it has received an equity infusion of $30 million from Myanmar-focused investment firm Myanmar Investments International Limited (MIL).

MIL made the investment into Apollo Myanmar’s holding company Apollo Towers Pte Ltd, founded by Sanjeev Ahuja, former CEO of Orange Group and founder of Eaton Towers in Africa, and TPG Growth, a growth equity investment platform of private investment firm TPG.

The investment is MIL’s largest into Myanmar and the proceeds will go towards funding Apollo Towers’ buildout of existing and new towers, Apollo Myanmar said in a statement.

Apollo owns and operates a telecommunication towers business in Myanmar and has already constructed over 1,100 on-air telecommunication towers in the country. The firm recently announced a contract with Telenor, one of the two foreign mobile network operators in Myanmar, for the construction of a further 717 telecommunication towers. In the period to March 31, 2014 Apollo Myanmar made a loss of $0.73 million.

For the purpose of making the investment, MIL has established a British Virgin Islands subsidiary, MIL 4 Limited, and contributed $20 million for a 66.67 percent shareholding in MIL 4. LIM Asia Special Situations Master Fund Limited, a substantial shareholder in MIL, has contributed $9.8 million for a 32.67 percent shareholding, with the remaining 0.67 percent being held by an unconnected third-party, MIL said in a statement.

MIL 4 has entered into a share subscription agreement with Apollo in respect of a subscription for $30 million of preference and ordinary shares in Apollo which amounts to a 14.18 percent interest in Apollo. MIL’s indirect shareholding in Apollo is 9.46 percent, the AIM-listed company said.

Michael Dean, a director of MIL, said: “Part of MIL’s strategy is to target investment opportunities in Myanmar where there are acute shortages and long term growth potential. Apollo, with its established market leading position in a fast growing and essential sector of the Myanmar economy, epitomises these opportunities.”

Ahuja, who is currently the chairman of Tillman Global Holdings LLC, said, “We … look forward to further progress in Myanmar, as additional orders are being worked for our telecommunication operator customers. We see a tremendous opportunity here.”

As a result of the liberalisation of the telecommunications sector in June 2013, mobile telecommunications is one of the fastest growing sectors in Myanmar. Industry analysts estimate that the country’s mobile phone penetration rate is now over 40 percent, compared to only 9 percent two years ago.

Telecommunication tower infrastructure is an essential component of the communication industry, hosting equipment for cellular, wireless, radio and television broadcast, microwave, and two-way radio communication throughout the world.

Given Myanmar’s current developing communication infrastructure, the pledged coverage rates of over 90 percent by the telecom operators will require a significant expansion of the country’s telecommunication tower network.

The chief financial officer of Apollo Towers Myanmar Shyamsunder said the investment “is coming right at the time of our second phase of rollout and it will add great value to our current operations.”

Source: Myanmar Business Today