Information
The operator says reintegrating the tower belongings will strengthen its African operations and enhance monetary metrics
African telco large MTN Group is ready to take full management of IHS Towers, one in every of Africa’s largest impartial tower firms, in a deal valued at $6.2 billion.
The deal will see MTN purchase the 75% stake in IHS that it doesn’t already personal for $2.2 billion in money.
“This proposed transaction is a pivotal step in additional strengthening MTN Group’s strategic and monetary place for a future the place digital infrastructure will turn out to be ever extra important to Africa’s progress and improvement. This transaction offers us a novel alternative to purchase again our towers and strengthen our capacity to be companions for progress to the nation states during which we function,” mentioned MTN CEO Ralph Mupita.
The deal is topic to the standard regulatory approvals, with watchdogs more likely to look carefully on the impression on competitors, given IHS additionally rents their infrastructure to MTN’s rivals throughout Africa.
For MTN, the transfer represents one thing of a strategic U-turn. The operator group has pursued an asset-light method for the previous decade, promoting a lot of its towers – largely to IHS – in a number of markets.
In recent times, nonetheless, MTN’s relationship with the tower firm has grown extra sophisticated. The operator has repeatedly complained about IHS’s company governance, notably that IHS had capped its voting rights at 20%, regardless of MTN proudly owning a stake of round 26% within the enterprise.
On the identical time, IHS noticed main losses from the devaluation of the Nigerian naira in 2023, main MTN to try to hunt adjusted lease phrases to scale back overseas‑forex publicity.
Given this more and more troublesome working relationship, MTN’s stake acquisition represents a chance to simplify and de-risk the corporate’s stability sheet by eradicating lengthy‑time period lease liabilities.
Market watchers shall be watching whether or not MTN’s reintegration of roughly 29,000 African websites delivers the monetary and strategic positive factors administration forecasts, and whether or not rivals reply with selective buybacks, new sharing offers, or continued reliance on impartial towercos.
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