Mohsin Siddiqui (Chief Reporter)

Pakistan Telecommunication Company Limited (PTCL) has reached a significant milestone by securing financing for its acquisition of Telenor Pakistan and Orion Towers (Private) Limited. This deal, subject to regulatory approvals, was celebrated at a prominent event held in Karachi.

PTCL signed a share purchase agreement with Telenor (ASA) in December 2023, with the acquisition price agreed at PKR 108 billion (on a debt-free, cash-free basis). The acquisition is a game-changer for Pakistan’s telecom sector, reflecting PTCL’s ambitions for long-term growth and market leadership.

To finance the acquisition, PTCL sought the involvement of the International Finance Corporation (IFC), a member of the World Bank Group, which led a consortium to provide the necessary funds. The financing deal, approved by the IFC Board of Directors in April 2024, totals up to USD $400 million and represents the largest single financing in Pakistan’s telecom industry to date.

The IFC-led consortium includes two significant co-investors: the Silk Road Fund (SRF), a Chinese state-owned medium-to-long-term investment fund, and British International Investment (BII), the UK’s development finance institution. The collaboration between PTCL and these global financial players highlights the strategic importance of Pakistan’s telecom sector in driving the country’s economic growth.

The formal celebration of this historic financing deal took place at a prestigious event in Karachi, with top officials and dignitaries in attendance. Mr. Jameel Ahmad, the Governor of the State Bank of Pakistan (SBP), was the chief guest, demonstrating the government’s full support for this transformative development in the telecom sector. The event was also graced by high-profile figures such as PTCL & Ufone 4G’s President and Group CEO, Hatem Bamatraf, IFC’s Regional Director for the Middle East, Pakistan & Afghanistan, Khawaja Aftab Ahmed, the UAE Ambassador, the British High Commissioner, as well as senior executives from the PTCL Group and members of the consortium.

During the event, Mr. Jameel Ahmad, Governor of the State Bank of Pakistan, emphasized the significance of this financing, stating, “IFC’s financing in Pakistan’s telecom sector reinvigorates confidence in the sector’s growth potential. The telecom and digital sectors are vital contributors to the national economy, and their growth and sustainability will play an important role in the country’s economic prosperity.” He further assured that the SBP is committed to facilitating such developments, as they are expected to bring wide-ranging benefits to Pakistan.

This financing agreement represents a pivotal moment in PTCL’s acquisition journey, providing the company with the financial backing it needs to conclude the deal. The acquisition of Telenor Pakistan and Orion Towers will allow PTCL to strengthen its position in the telecom market, enhance its economies of scale, and support its long-term sustainability.

Hatem Bamatraf, President and Group CEO of PTCL and PTML (Ufone 4G), also expressed his gratitude to the IFC-led consortium for their support in making this historic deal a reality. He described the deal as a “defining moment for Pakistan’s telecom sector,” highlighting that the secured financing would not only strengthen the PTCL Group but also benefit the entire telecom industry by enabling economies of scale and promoting long-term financial stability.

“This is the largest single financing ever secured in the industry,” Bamatraf said. “Through this strategic move, PTCL Group remains fully committed to delivering high-quality cellular and data services to an even wider customer base across Pakistan in the near future.” Bamatraf’s comments underline the broad impact this acquisition will have on the telecom sector, as PTCL aims to continue delivering reliable and high-performance digital services, further contributing to the country’s economic and societal progress.

Khawaja Aftab Ahmed, IFC’s Regional Director for the Middle East, Pakistan, and Afghanistan, reaffirmed IFC’s commitment to supporting Pakistan’s telecom sector. “Pakistan’s telecommunication market offers significant opportunities for growth and investment. This investment reflects IFC’s dedication to bolstering inclusive, high-quality digital connectivity and infrastructure in the country by working together with partners like PTCL Group, the Government of Pakistan, and co-investors such as BII and SRF,” he said.

IFC’s involvement is not only financial but also strategic, as it aligns with the organization’s broader goals of supporting developing markets and promoting digital inclusion. The financing deal is expected to spur greater investment in Pakistan’s telecom infrastructure, enhancing the quality of services available to consumers while fostering competition and innovation within the industry.

While PTCL has secured the necessary financing, the acquisition of Telenor Pakistan and Orion Towers is still awaiting regulatory approval from the Competition Commission of Pakistan (CCP). Once approval is granted, the deal will position PTCL as a dominant player in the telecom market, equipped with the resources and scale to drive growth and innovation.

As the digital landscape in Pakistan continues to evolve, PTCL’s acquisition of Telenor Pakistan and Orion Towers is a major step toward improving the country’s digital infrastructure. The enhanced capacity from this acquisition will allow PTCL to expand its service offerings and reach, contributing to the overall economic growth and development of Pakistan.

The event concluded with a presentation of memorabilia by the chief guest on behalf of the PTCL Group, symbolizing the strong partnerships forged between PTCL, IFC, and their co-investors. The acquisition deal represents a promising future for Pakistan’s telecom sector, with the potential to revolutionize digital services and bring long-term benefits to the economy and society.