Infrastructure sharing joint venture to launch in Ghana

Details: James Barton; Category: Wireless Networks; 14 December 2010; 12984 views

A new independent tower company will begin operating in Ghana as a result of a joint venture between American Tower Corporation and MTN...

A new independent tower company will begin operating in Ghana as a result of a joint venture between American Tower Corporation and MTN.

The new company, TowerCo Ghana, will be managed by American Tower, and owned by a holding company in which subsidiaries of the two joint venture partners will hold shares (American Tower’s subsidiary will hold a 51% majority share).

The transaction involves the sale of up to 1,876 of MTN Ghana’s existing sites to TowerCo Ghana for an agreed purchase price of up to approximately $428.3 million, of which American Tower will pay up to approximately $218.5 million for its 51% stake in the holding company.

MTN Ghana will be the anchor tenant, on commercial terms, on each of the towers being purchased. American Tower also expects that TowerCo Ghana will build at least an additional 400 sites for both MTN Ghana and other wireless operators in Ghana over the next five years. The transaction is expected to close by early 2011, subject to customary closing conditions.

“We are pleased to announce the launch of our operations in Ghana in partnership with MTN,” said Jim Taiclet, Chairman, President and Chief Executive Officer of American Tower Corporation. “Creating an independent tower company in Ghana reflects the execution of our strategy to invest in selected African markets with strong wireless growth potential and a positive investment climate.”

Group President and CEO of MTN Group, Phuthuma Nhleko, added that “Infrastructure sharing makes absolute sense for MTN and was a key aspect of the updated strategy outlined to MTN shareholders on 15 July 2010. We have in the recent past looked at various permutations to reduce our infrastructure roll-out costs as well as the on-going costs of operating our passive infrastructure in our key markets. Because market conditions in each of the markets are unique, we have resolved to evaluate infrastructure sharing opportunities on a market by market basis.”

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