KARACHI, December 10th 2024: Samad Dawood, Vice Chairman of Dawood Hercules Corp, emphasized that the tough economic measures implemented by the Government of Pakistan have contributed significantly to macroeconomic stability and revived investor confidence in the country. This improved business environment was a key factor in Engro’s landmark transaction, the largest in Pakistani rupee terms, marking a significant step forward for Pakistan’s economy.
Strategic Partnership with Jazz and VEON Group
Last week, Engro Corporation announced a strategic partnership with Pakistan Mobile Communications Limited (Jazz) and its parent company, VEON Group, to expand its presence in the mobile tower-sharing business. Under this agreement, Jazz’s telecom infrastructure assets, held by its subsidiary Deodar (Private) Limited, will be transferred to Engro Connect, a subsidiary of Engro Corporation. Engro will assume responsibility for Deodar’s debt, totaling USD 375 million, and provide Jazz with an additional USD 187.7 million. The deal, which is still subject to corporate, legal, and regulatory approvals, marks a major milestone in Engro’s diversification into the telecom infrastructure sector.
Macroeconomic Stability Fuels Growth
Samad Dawood attributed the success of this deal to the positive macroeconomic developments in Pakistan, particularly the hard decisions taken in recent quarters. “The actions taken in Pakistan, alongside the approval from the IMF, have created a favorable environment for foreign investors,” Dawood said. He further noted that the decline in interest rates and inflation, coupled with Pakistan’s ongoing IMF program, has significantly improved the investment climate, making the country an attractive destination for international financiers.
Expanding Tower Sharing and Exploring New Markets
Engro’s partnership with Jazz is not only focused on expanding tower-sharing coverage to other telecom operators but also explores new business avenues, including electronic vehicle charging stations and drone landing infrastructure. “Pakistan’s telecom sector is large and continues to grow,” said Dawood, noting that the deal will enable Engro to leverage telecom infrastructure on a larger scale. He also identified potential international markets, from the Atlantic coast of Morocco to Central Asia, where Engro’s services could be expanded in the future.
Strengthening Pakistan’s Digital Transformation
Since entering the telecommunication infrastructure sector in 2018, Engro has been providing essential infrastructure to all Mobile Network Operators (MNOs) in Pakistan. By using Engro’s enhanced infrastructure, MNOs can reduce their capital and operational expenditures, enabling them to focus on improving services and expanding network coverage. This collaboration will not only improve connectivity in underserved areas of Pakistan but also support the country’s ongoing digital transformation.
With this strategic partnership, Engro is well-positioned to play a crucial role in the growth of Pakistan’s telecom sector, while simultaneously serving as a bridge to international markets. The deal stands as a testament to Pakistan’s evolving business climate and its increasing appeal to global investors.
