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MTN to transfer operation of 9,151 Nigerian mobile towers to IHS [IntelliNews - Weekly Reports](IntelliNews - Weekly Reports Via Acquire Media NewsEdge) South Africa-based telecoms group MTN has agreed to transfer the operation of its 9,151 mobile network towers in Nigeria to Nigeria-based mobile infrastructure company IHS Holding in a bid to cut operating costs, expand voice and data capacity, and drive network efficiencies, IHS said in a statement. Under the deal, which is subject to regulatory approvals, MTN's towers business will be transferred to a new company, which will be owned jointly by MTN and IHS, with IHS having full operational control of the business. Financial details about the transaction were not disclosed, but media reports have suggested that MTN's Nigerian towers are worth about USD 1.8bn. The deal is expected to close by the end of this year. The new towers joint venture pledges to invest more than USD 500mn over four years into tower upgrades and a maintenance programme to improve the quality of service on the MTN Nigeria network. MTN has admitted that it faces challenges with the quality of service in Nigeria due to high demand. Earlier this year, it was fined by the local regulator, together with two other Nigerian operators, for poor service quality and breaching of key performance indicators. The companies were also banned from selling SIM cards during March. In May, the company's CEO Sifiso Dabengwa said MTN would invest more than USD 3bn to upgrade and expand its network in Nigeria over the next three years. Nigeria is the single biggest market for MTN, which is the largest operator in Africa. MTN is the largest operator in Nigeria with 58.4mn subscribers as of end-June 2014, up 2.1% compared to end-March. For IHS, this deal will double the size of its business, strengthening its position as one of the largest tower companies in Africa. Last month, IHS agreed to buy 2,136 towers from Etisalat Nigeria, part of UAE's state-owned telecoms group Etisalat, saying that upon the conclusion of the transaction, expected later this year, it will own and manage over 6,540 towers in Nigeria. Currently, IHS manages over 10,000 towers in Nigeria, Cameroon, Ivory Coast, Zambia and Rwanda. It has previously bought MTN's tower business in Ivory Coast, Cameroon, Rwanda and Zambia. There is a wider shift in Africa towards co-location and leasing mobile communications towers from independent tower operators, as the maintenance of towers is typically more expensive than in other regions because of security costs and electricity shortages. In July, India-based telecoms group Bharti Airtel agreed to sell 3,100 telecom towers in four African countries to Helios Towers Africa (HTA) as part of a wider drive to sell its all 15,000 towers across 17 African countries. Media reports have suggested that France's Orange is in talks to sell a number of towers in Sub-Saharan Africa and Egypt. (c) 2014 Emerging Markets Direct Media Holdings LLC Provided by SyndiGate Media Inc. (Syndigate.info). |