IHS Holding Limited (“IHS”), the largest mobile telecommunications infrastructure provider in Africa, Europe and the Middle East, today March 10, 2016 announced that it has acquired 100% stakes in Helios Towers Nigeria Limited (“HTN”) the pioneer of tower infrastructure sharing in Africa.
With the acquisition IHS will acquire HTN’s portfolio of 1,211 diversified tower sites throughout Nigeria.
“We have built a unique urban centric portfolio across Nigeria with the highest tenancy ratio in the industry and a diversified tenant mix. IHS is the natural buyer of our business and we believe their deep knowledge and extensive experience in the sector will help to continue the strong level of customer service already being achieved by HTN ” said Inder Bajaj, Chief Executive Officer of HTN.
HTN and IHS established the mobile telecommunications infrastructure industry in Nigeria in the early 2000s and this transaction will be the first in-market consolidation in Africa.
Under the terms of the transaction and subject to requisite regulatory approvals, IHS will acquire the entire issued share capital of HTN from HTN Towers Plc which is ultimately owned by Helios Investment Partners, Pembani Group, First City Monument Bank and other minority shareholders.
Upon completion of the transaction, IHS will have full operational control of the underlying business and will market independent infrastructure sharing services to mobile network operators and internet service providers in Nigeria.
Business will continue as usual for HTN’s towers which will be seamlessly integrated into the IHS network and connected to IHS’s state of the art network operating centre which monitors each tower 24 hours a day, seven days a week. The transaction is expected to close in Q2 2016.
“This transaction is significant in that it combines Africa’s two original tower companies and will enable us to strengthen our service offering to our customers while focusing on their needs. We remain committed to the Nigerian tower market where coverage levels are yet to mature and explosive data growth continues. The growing data traffic and increased smartphone use presents an exciting market opportunity for IHS, with the potential for up to 40,000 more towers required to meet this demand” Issam Darwish, Executive Vice Chairman and Group Chief Executive Officer of IHS said.
The net leverage position of the combined entity is likely to be approximately 50% lower than the current HTN stand-alone leverage position.
With a population of nearly 180 million people, increasing smartphone penetration and limited fixed line infrastructure, Nigeria’s vibrant wireless industry is poised for a sustained period of network investment and growth.
This transaction strengthens IHS’s position as the market leading Tower Company in Nigeria and provides IHS the opportunity to optimise a larger portfolio through innovative green energy solutions and delivery of market leading quality of service.
IHS says it will “work to roll out its renewable energy solutions and diesel reduction initiatives whilst maintaining unparalleled network uptime.”
Transactions such as the acquisition of HTN have allowed IHS to create significant local technical and engineering employment opportunities throughout Africa. Over 95% of IHS’s employees are African and IHS employs close to 40,000 people directly and indirectly through its exclusive subcontractors.
IHS and HTN were advised by UBS and Citigroup, respectively.