Bharti Airtel has sold another 1 100 towers in two of its African operations, this time to IHS.
Airtel's move follows on its September deal with Eaton to sell that company 3 500 towers in six African countries, as well as its July announcement to sell about 3 100 masts in four African countries to Helios Towers Africa.
The sales are part of the Indian group's plan to divest most of its more than 15 000 towers in Africa in a process that sources have said could raise up to $2 billion.
Several mobile operators have recently taken steps to hive off their base stations and then lease them back in a bid to curb rising costs at a time when their revenue lines are under pressure. In September, MTN sold off its Nigerian towers to a company to jointly be owned by it and IHS in a deal apparently worth R20 billion.
Airtel has not disclosed the amount it will receive for its towers, but based on the $2 billion figure, the deal could be worth around $147 million, or R1.7 billion. As part of the deal, Airtel - one of Africa's largest mobile operators - will sell and lease back the towers under a ten-year deal.
Tighter focus
The agreement expands IHS' tower portfolio to more than 21 000 base stations in five countries, the companies say in a statement. Christian de Faria, MD and CEO of the African unit at Airtel, says the move "will accelerate infrastructure sharing amongst operators and benefit customers in form of affordable tariffs and wider network coverage."
In addition, the deal allows Airtel to focus on its core business and customers, and enables it to deleverage through debt reduction, and will significantly reduce its on-going capital expenditure on passive infrastructure in these African markets.
For IHS, the acquisition represents another "major step towards the scale needed to provide shared telecoms infrastructure solutions in Africa," it says. It notes tower sharing leads to more stable networks, higher network uptimes in which to make calls and a more ubiquitous service across the country.
IHS executive vice chairman and group CEO Issam Darwish notes the opportunity to expand its East African business "is an excellent opportunity".
The agreements are subject to statutory and regulatory approvals.
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