Due diligence, business case evaluation and planning


Our experience covers fixed and mobile networks, terrestrial and submarine fibre optic networks, wireless access networks, and a wide range of telecoms and IT services.

BMI-T combines research from its own databases on African telecoms markets with data from the project sponsors and other secondary sources, in support of playing its role of independent advisor outlined below. In some cases, new primary research may be commissioned as required for the specific investigation.

The outcome of each due diligence study is a considered judgement on the soundness of the investment, based on risk analysis and an independent assessment of risk mitigation activities that have been taken by the project's sponsors.

Following on from the investigation, there is an option of BMI-T assisting the client in facilitating communication between the interested parties, while always remaining in the role of dispassionate, third party advisor. BMI-T will also explore other ways of assisting clients in taking the first steps towards implementing the project.

 Approach

Each due diligence engagement typically entails an appraisal of supplied documentation and data, a business and financial model review, and a review of any documentation provided by the project sponsor, to facilitate the provision of expert opinion regarding the viability, risk profile, and recommendations for modifications and / or improvements to existing plans and requirements. As due diligence advisor, BMI-T's brief would be to use its extensive knowledge of the African telecommunications market, to scrutinise the project sponsor's business case with a view to:

  • Confirming market size and growth rate, by creating scenarios for upside and worst case situations;
  • Confirming whether the Sponsor's marketing strategy is correct and viable in order to secure the required customers;
  • Scrutinising the practicality of the underlying assumptions used in the business case, including market growth rate and market pricing trends and their impact on the projected revenues;
  • Considering the impact of other  competitors or potential new entrants, and the Sponsor’ ability to capture market share based on its competitive position.

 Our Expertise

Since inception in 1990, BMI-T has conducted numerous research and consulting projects in sub-Saharan Africa, including investment reviews for operators and funding arrangers, in South and Southern Africa, Nigeria and various East African countries. These include:

  • Submarine cable due diligences (2007, 2008, 2012)
  • Trans-regional terrestrial fibre feasibility study (fourteen African countries)
  • National long distance transmission – due diligence, business case assessment, business plan (Nigeria 2006, South Africa 2010)
  • Metro fibre projects (2008, 2011, 2012)
  • Metro Ethernet / Carrier Ethernet (2011)
  • Wireless cellular, CDMA, microwave, WiMAX/Wi-Fi/wireless mesh projects
  • DSL vs wireless broadband strategy for a converged fixed and mobile operator
  • New fixed line operator and strategic equity partner (country and market entry strategy and detailed market plan)
  • Wireless operator (full strategy review)
  • SADC eReadiness review (2002) and SADC investment opportunities study (2003/4) for the World Bank.
  • Various other due diligence and business case assessments, including: hosting, payment gateways, call centres, BPO and related offshoring opportunties, Voice/VoIP/SIP, international gateway, IP peering, data centres, towers/masts and other infrastructure sharing.

 BMI-T routinely conducts its own research projects in the region, , for example:

  • Telecoms Opportunities in the SADC/EAC region (2004,2005,2006)
  • The Nigerian Telecoms Market (2004, 2005,2006,2007)
  • African Telecoms Infrastructure Investment (annuall from 2005 through 2012)
  • African Broadband and Wireless Access Market, (annual frmo 2006 through 2012)
  • Outlook for Submarine and Terrestrial Fibre Optic Cables in Africa (2008, 2010)
  • Regulatory Trends Across Africa (2008, 2010)
  • Outlook for WiMAX and CDMA in Africa (2008)
  • Outlook for Terrestrial Fibre Projects in South and Southern Africa (2010)
  • Sub-Saharan African Bandwidth model (ongoing). 

 Why BMI-T

BMI-T has specific expertise in projects of this nature, and has access to existing research on a wide range of technologies and markets. While we cover the entire ICT field, we have a particularly strong focus on broadband infrastructure, notably fibre optic investments, as well as wireless transmission and spectrum-related investigations – covering business, market and financial aspects, technology and engineering evaluations and regulatory and funding models.

BMI-T has completed private contracts involving the telecommunications sector in 17 African countries.

Case Studies: 

Bandwidth Demand Modelling & Business Case Development

The client, a major player in the submarine fibre-optic cable domain needed independent verification on a model they

Due Diligence of a Payment Gateway Platform

The client needed to determine whether a Payment Gateway Platform and associated proposed operational business model would be feasible and sustainable.

Telecoms Business Case Assessment

The client, a private equity firm, had a need to determine viability of a project they had been approached to fund by two