MTN Ghana in R2,9bn tower-sharing deal
Less than a month after winning a deal to buy Cell C’s national tower infrastructure, US company American Tower Corp (ATC) has signed another big African tower-sharing deal, this time with MTN in Ghana.
MTN said on Monday that it reached an agreement with ATC to establish a joint venture in Ghana, to be called TowerCo Ghana.
TowerCo will be managed by ATC, which is taking a 51% stake in the new entity; MTN will hold the remaining 49%.
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 US$428,3m (R2,9bn).
ATC will pay up to $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. ATC also expects that TowerCo Ghana will build at least an additional 400 sites for both MTN Ghana and other wireless operators over the next five years.
MTN Group CEO Phuthuma Nhleko says infrastructure sharing makes “absolute sense”. “We have in the recent past looked at various permutations to reduce our infrastructure roll-out costs and the ongoing costs of operating our passive infrastructure in our key markets.”
Nhleko says that because market conditions in each of MTN’s markets are unique, it has decided to evaluate infrastructure-sharing opportunities on a country-by-country basis.
ATC’s deal with MTN comes just weeks after it concluded a deal to buy Cell C’s national network of base stations for $430m. Cell C will use the cash from the deal to restructure its balance sheet.