Investment

MTN Group confirms IHS Towers purchase with US$6.2 billion deal

MTN Group confirms IHS Towers purchase with US$6.2 billion deal

After talks widely reported earlier this month, pan-African operator the MTN Group has confirmed that it has agreed to take full control of tower operator IHS Towers, buying the roughly 75% stake it does not already own in a deal that values IHS at about US$6.2 billion.

IHS is one of the world’s largest tower companies, with nearly 29,000 high-quality towers in Africa serving various mobile network operators in five key MTN markets. MTN, Africa's biggest mobile operator, says it will pay US$8.50 per share in cash.

The deal will be funded through the rollover of MTN's existing stake of around 24% in IHS, as well as about US$1.1 billion in cash from MTN, roughly US$1.1 billion from IHS's balance sheet, and the rollover of no more than existing IHS debt, the companies said in a joint statement.

The proposed transaction, MTN says, marks an important step to unlock compelling value for MTN and strengthen and reintegrate its ownership of critical digital infrastructure across Africa.

As MTN Group President and CEO Ralph Mupita explains, the transaction is a pivotal step in further strengthening MTN Group’s strategic and financial position “for a future where digital infrastructure will become ever more essential to Africa’s growth and development”. He adds: “This transaction gives us a unique opportunity to buy back our towers and strengthen our ability to be partners for progress to the nation states in which we operate.”

But why are operators, including Africa’s biggest, now buying back assets they seemed only a few years ago to be happy to sell? That’s a topic we discussed recently in a feature examining why operators are taking back control of their passive infrastructure.



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