MTN Nigeria towers business to be transferred to IHS

MTN has reached an agreement in principle with IHS Holding Limited (IHS) for the transfer of its towers business, comprising up to 9,151 of MTN's mobile network towers in Nigeria. The transaction is expected to reduce MTN Nigeria's operating costs, drive network efficiencies and further expand MTN's voice and data capacity.

This is the ninth tower transaction for IHS and its fifth with MTN following the transactions in Cote d'Ivoire, Cameroon, Rwanda and Zambia that took place in 2012 and 2013. On completion of this transaction, IHS will manage over 20,000 towers in Africa.

Commenting on the transaction, Michael Ikpoki, MTN Nigeria CEO said: "The separation of MTN Nigeria's mobile network towers and operation of the underlying towers business by IHS reflects a major part of our strategy to optimise network quality and technological assets towards creating value and driving innovation to meet our customers' needs now and in the long term. Indeed, the trends and realities in our industry reveal the increased role of cost efficiency and optimisation of assets in guiding business decisions in order to remain competitive. We will continue to embrace strategies that enhance our services to our customers while ensuring our long-term business continuity, without compromising best practice."

Under the terms of the transaction and subject to requisite regulatory approvals, the towers will be transferred to a new company which will be owned jointly by MTN and IHS. IHS will have full operational control of the underlying business. The new towers company will market independent infrastructure sharing services to other mobile operators and Internet Service Providers (ISPs) in Nigeria. The transaction is expected to close in Q4 2014.

"We are delighted to have entered into a further transfer transaction with IHS, in our largest African market. IHS' deep knowledge and considerable experience in the sector will help drive efficiencies and enhance our network uptime, allowing us to concentrate on further raising our own service levels, improving the customer experience and ensuring we remain the number one operator in Nigeria", said Sifiso Dabengwa, Group President and CEO of MTN Group.