IHS Towers struck a deal with MTN Group to acquire 5,709 towers in South Africa for ZAR6.4 billion ($413.6 million), as the operator seeks a shift in its focus into strategic initiatives including around securing spectrum.
In a statement, IHS Towers explained it will own 70 per cent of the South African tower business and is in advanced talks regarding the remaining 30 per cent with a consortium of investors participating in the government’s Broad-Based Black Economic Empowerment programme.
IHS Towers will also provide power and related services to around 12,800 MTN sites in the country and pledged to invest in infrastructure to accelerate rollout of new technologies and enhance the efficiency of existing assets.
The company stated the move will transform it into the largest independent tower operator in South Africa and boost its efforts to be a leader in the overall continent. It expects the tower operation and power supply deals to generate revenue of $220 million in the first full year of operations.
IHS Towers CEO Sam Darwish stated the deal with MTN and its own expertise will allow it to deliver “an infrastructure capable of meeting South Africa’s increasingly sophisticated data demands”.
MTN has been considering a sale of its tower assets in South Africa since 2020. In a Johannesburg Stock Exchange filing, it explained the deal will allow it to service its retail and wholesale clients more efficiently, with proceeds to be reinvested into “strategic growth initiatives”, such as securing high demand spectrum and gaining balance sheet flexibility.
The deal is expected to close in Q1 2022, subject to regulatory approvals.Subscribe to our daily newsletter Back