TAWAL aims to deploy telecom towers in Pakistan; operational, financial goals continue growth: CEO

Mohammed Alhakbani CEO of TAWAL

TAWAL commenced operations in the Pakistani market as part of its plans to deploy telecommunications towers in cooperation with other operators, CEO Mohammed Alhakbani said.

In an interview with Argaam on the sidelines of LEAP 2023 in Riyadh, Alhakbani added that TAWAL seeks to expand presence as soon as possible to lead the region’s telecommunications and information technology infrastructure.

The company records growth in its operational and financial goals year after year. It targets overseas expansion through acquisitions and forays into new markets.

Here is the full interview with Alhakbani:

Q: What are the most prominent agreements signed by TAWAL during LEAP?

A: TAWAL signed several agreements and memorandums of understanding (MoUs) during LEAP, mainly an agreement with Thakher Development Co., the master developer of Thakher Makkah project, on the internal coverage of residential towers in the second phase of the project. An MoU was signed with Saudi Aramco and Saudi Downtown Co. to provide infrastructure services. TAWAL also signed an MoU with King Abdullah University of Science and Technology (KAUST) to develop the ICT infrastructure provider’s products.

Moreover, we signed agreements with Electromin, a technology-driven electric vehicle (EV) solutions and services provider, to enhance the Kingdom’s EV charging infrastructure. TAWAL signed other agreements with Omniflow and Schreder to deploy smart poles.

Q: How do you see the ICT sector in Saudi Arabia, especially regarding 5G and smart cities?

A: In the last five years, Saudi Arabia made a wide stride in modern technology, the global telecommunications revolution and artificial intelligence (AI). Digital economy is also one of the Kingdom’s strategic objectives. In order to achieve this, an infrastructure should be developed to help achieve these objectives.

TAWAL is pleased to play a key role in the deployment of infrastructure with operating efficiency to help our customers roll out 5G networks, as digital economy counts on linking authorities and agencies in the government sector, private firms and even individuals.

Today, work and learning are available online, along with many mobile banking transactions and deals. These are all implemented by an infrastructure network across the Kingdom.

Q: Last year, TAWAL acquired telecom towers in KAEC. What about the deal’s details and its impact on TAWAL?

A: King Abdullah Economic City (KAEC) provides services for the industrial and tourism sectors. It is home for many residential projects as well as MBSC Prince Mohammed Bin Salman College of Business and Entrepreneurship. Telecom towers had been earlier built in the city as part of its development plan.

KAEC selected TAWAL as its strategic partner to acquire and operate these towers, incur the related cost and reoffer services to operators. As TAWAL’s objectives aligned with KAEC, we acquired 15 towers. Now, we provide services for operators at KAEC.

Q: In 2022, stc, which owns 100% of TAWAL, received an offer from the PIF to buy 51% of TAWAL for a total valuation of SAR 21. 94 billion. Any updates on this deal?

A: Talks are still ongoing between stc and the Public Investment Fund (PIF). We mainly focus on improving our operating performance and customer service with the best operating efficiency and new services to boost revenue and growth.

Q: Will TAWAL offer a stake of its share capital in the Saudi stock market?

A: This depends on the company’s future plan. The decision to go public is usually taken by shareholders.

Q: What about your future projects in the Saudi market? Are there any plans to foray into new markets?

A: TAWAL has a clear strategy to lead the sector of telecom infrastructure and information technology in the region. On one hand, we focus on Saudi Arabia as our top priority and the highest growth market, where our clients have great aspirations for network deployment. On the other hand, we eye expansions outside the Kingdom by obtaining new licenses.

In the last few years, TAWAL cooperated with all operators and shared 16,000 telecom towers. It was able to achieve growth and deployment requirements for the target network, enhance signals and improve services for end users.

We now focus on providing infrastructure services for smart cities in the Kingdom’s mega projects, such as NEOM and Diriyah.

Earlier this month, TAWAL signed an agreement with Diriyah Gate Development Authority (DGDA) to build 80 telecom towers and enable sharing infrastructure services with network operators. These towers will be designed in a manner to blend in with the surrounding heritage and architectural design.

Other agreements were signed for the same purposes in AlUla, The Red Sea, etc.

Outside Saudi Arabia, we launched operations in Pakistan, and we are exploring other good opportunities in the region.

Q: What are the details of TAWAL’s investments in Pakistan and what about their value?

A: Pakistan is a promising market for growth, as the 4G network is not widespread there, and the 5G spectrum has not yet been offered.

We expect a great future for this market, as the country's population exceeds 200 million people, and the percentage of youth is very high. Further, there are only 40,000 towers in Pakistan, which signals a great opportunity for the sector to expand over the next years. The only challenge in Pakistan is the economic situation amid global inflation. However, we expect a positive return from this market in the long term.

We acquired Pakistan's AWAL Telecom, with the aim of obtaining the license. We intend to invest in the deployment of telecom towers and hold discussions with operators to know their requirements and develop our plans for network deployment based on these targets.

If we are offered a good opportunity to acquire towers, it will be carefully studied to achieve a positive return. We will certainly seize any opportunity in our target markets.

We also do not forget that entry into new markets will be determined based on the requirements of such markets, access to licenses, as well as the availability of legal and investment regulations that help us operate with high efficiency. Therefore, we need more time to enter these markets in order to be able to provide our services effectively, as we always seek to enhance our presence as quickly as possible.

Q: How was the company’s financial performance in 2022?

A: The company's financial results are positive, as is the case with stc. Since we are a subsidiary of stc, which is listed on the Saudi market, it would be difficult to disclose the details of our financials. TAWAL's figures are published in stc's consolidated financials, and we thankfully achieve growth in our operational and financial targets year after year.

Q: Can you give us insight into TAWAL’s sustainability strategy?

A: We have many targets and aspire to contribute to reducing the adverse impact of environmental challenges. At TAWAL, we are keen to link telecom towers to the power grid. We avoid using diesel as much as we can to cut carbon emissions. We connected 300 tower sites to the grid, dismissing 28,000 metric tons of carbon emissions.

In the last three years, we cultivated more than 4,000 trees as part of the company’s social responsibility.

TAWAL launched a program for recycling network and tower waste to realize the Kingdom’s goals for protecting environment.