Telecoms operator Zain Saudi Arabia has agreed to sell its portfolio of Saudi Arabian towers to IHS Holding for US$647.7 million in a sale-and-leaseback transaction. Zain Saudi will divest its 8,100 towers and related passive infrastructure and lease them back for 15 years with an option to renew for five years. The deal also includes the construction of about 1,500 towers over the next six years. 

The proceeds are expected to fund the Murabaha facility of Zain Saudi, an Islamic financing structure, by 2.43 billion riyals, resulting in savings to the debt servicing. It will also allow Zain to focus on its core business and grow infrastructure with reduced investment.

The deal is subject to a final binding agreement between the parties, as well as regulatory approval and approval from lenders.