Engro Executes Rs. 133 Billion Islamic Financing Deal to Expand Telecom Tower Business in Pakistan

Pakistan’s telecom and digital infrastructure sector has received a major boost as Engro Corporation successfully executed a Rs. 133 billion Islamic financing deal to expand its telecom tower business. This landmark transaction adds Deodar’s more than 10,000 telecom towers to Engro’s growing infrastructure portfolio, strengthening domestic ownership in critical digital assets.

The deal is being termed one of the largest Shariah-compliant corporate financings in Pakistan’s telecom infrastructure history, highlighting the rising capacity of Islamic banking in funding large-scale strategic projects.

Overview of Engro’s Rs. 133 Billion Telecom Financing Deal

Engro completed the transaction through 100% Islamic (Shariah-compliant) financing, arranged by a consortium of Islamic banks and Islamic windows of conventional banks. The financing enabled Engro to acquire Deodar, a major telecom tower company, significantly expanding its footprint in Pakistan’s telecom infrastructure market.

Key Highlights of the Deal

• Total Financing Size: Rs. 133 billion
• Financing Type: Fully Islamic (Shariah-compliant)
• Assets Acquired: Over 10,000 telecom towers
• Sector: Telecom infrastructure
• Banks Involved: Meezan Bank, UBL (Islamic Window), and others

This transaction reinforces Engro’s long-term strategy to invest in essential infrastructure that supports digital connectivity, financial inclusion, and economic growth.

Why Telecom Towers Are Critical for Pakistan’s Digital Future

Telecom towers form the backbone of mobile networks, broadband connectivity, and digital services. With increasing demand for:

• 4G and future 5G services
• Mobile banking and digital wallets
• E-commerce and cloud services
• Remote work and online education

Pakistan requires a robust, shared, and cost-efficient telecom infrastructure.

Shared Infrastructure Model Explained

Under Engro’s model:

• One telecom tower can be shared by multiple mobile network operators
• This reduces duplication of infrastructure
• Lowers capital expenditure for telecom companies
• Improves coverage in rural and underserved areas

According to Engro, each telecom tower costs approximately $50,000, making infrastructure sharing essential for cost optimization.

Role of Deodar in Engro’s Telecom Expansion

Deodar is a well-established telecom tower company with more than 10,000 operational towers across Pakistan. By integrating Deodar’s assets, Engro has instantly scaled its telecom infrastructure presence.

Benefits of Deodar Acquisition

• Nationwide telecom tower footprint
• Improved tower utilization rates
• Faster rollout of new network technologies
• Support for future 5G deployment

This acquisition positions Engro as a key player in Pakistan’s telecom infrastructure ecosystem, alongside global tower operators.

Islamic Financing: A Milestone for Pakistan’s Banking Sector

The Rs. 133 billion deal showcases the maturity and scalability of Islamic finance in Pakistan. Traditionally, mega infrastructure projects relied heavily on conventional financing, but this transaction proves that Islamic banks can now fund complex, large-ticket corporate deals.

Shariah-Compliant Financing Structure

While exact details were not publicly disclosed, such transactions typically involve:

• Ijarah (leasing)
• Musharakah (partnership)
• Diminishing Musharakah
• Sukuk-like asset-backed arrangements

This ensures compliance with Islamic principles while meeting modern corporate financing needs.

Banks and Institutions Involved in the Deal

The financing was arranged by a consortium of leading Islamic banks and Islamic windows of conventional banks, including:

• Meezan Bank
• United Bank Limited (UBL – Islamic Window)
• Other participating lenders

The presence of multiple banks reduced risk exposure and ensured smooth execution of the transaction.

State Bank of Pakistan’s Role and Perspective

An event marking the completion of the transaction was attended by:

• Senior Engro officials
• Representatives of participating banks
• Legal and financial advisers
• State Bank of Pakistan (SBP) Governor Jameel Ahmad

SBP Governor’s Remarks

Governor Jameel Ahmad emphasized:

• The importance of telecom connectivity for digital finance
• The role of infrastructure in financial inclusion
• The significance of Islamic banking in Pakistan’s economic development

His remarks highlighted how telecom infrastructure directly supports branchless banking, mobile wallets, and digital payment systems.

Impact on Pakistan’s Telecom Sector

1. Lower Network Costs

Shared towers reduce capital and operational costs for telecom operators, enabling:

• Competitive pricing
• Better service quality
• Faster expansion

2. Improved Rural Connectivity

Infrastructure sharing makes it economically viable to expand coverage in:

• Remote areas
• Underserved regions
• Low-income communities

3. Support for 5G Readiness

A dense and modern tower network is essential for:

• 5G deployment
• Low-latency services
• Internet of Things (IoT)

Engro’s Broader Infrastructure Strategy

Engro has consistently invested in strategic sectors, including:

• Energy
• Fertilizers
• Food
• Petrochemicals
• Infrastructure

The telecom tower expansion aligns with Engro’s vision of supporting Pakistan’s digital transformation while ensuring sustainable returns.

Domestic Ownership of Critical Digital Infrastructure

One of the most important aspects of this deal is domestic ownership of telecom infrastructure. This ensures:

• National data security
• Policy alignment with Pakistan’s digital goals
• Long-term investment stability

Engro officials stated that local ownership in critical digital assets is essential for Pakistan’s sovereignty in the digital economy.

Economic and Employment Benefits

Direct Benefits

• Expansion of telecom infrastructure
• Increased investment activity
• Strengthening of Islamic banking

Indirect Benefits

• Job creation in maintenance and operations
• Growth in digital services
• Boost to fintech, e-commerce, and startups

Future Outlook for Engro’s Telecom Business

With the acquisition of Deodar:

• Engro is expected to further optimize tower utilization
• Explore partnerships with telecom operators
• Support upcoming technologies like 5G and smart cities

Industry experts believe Engro’s telecom business could become a major revenue contributor in the coming years.

Conclusion

Engro’s Rs. 133 billion Islamic financing deal marks a transformational moment for Pakistan’s telecom infrastructure and Islamic banking sectors. By acquiring Deodar’s extensive tower network, Engro has strengthened domestic ownership of critical digital infrastructure while supporting nationwide connectivity and financial inclusion.

This landmark transaction not only reflects Engro’s strategic vision but also signals Pakistan’s readiness to fund mega infrastructure projects through Shariah-compliant financial systems, paving the way for a more inclusive and digitally connected future.

Engro Telecom Tower Financing Deal – FAQs