Etisalat, disclosed Thursday it would sell 2,136 of its towers to IHS Nigeria and lease them back as part of broader plans to expand its coverage in Africa’s biggest economy.
IHS is an independent mobile telecommunications infrastructure provider headquartered in Nigeria and founded in 2001.
The deal, for which a financial value was not given, is expected to close later this year, Etisalat Nigeria said in a statement. Banking sources told Reuters late last year that the deal might raise about $400 million.
Under terms of the agreement, IHS committed to investing a further $100 million in the towers, on areas such as advanced generators and efficient batteries. The deal will leave IHS owning and managing over 6,540 towers in Nigeria.
Building and maintaining mobile communications towers in Africa is typically more expensive than in other regions because of security costs and electricity shortages. That has increasingly prompted operators to sell or lease towers to specialist firms.
Matthew Willsher, CEO of Etisalat Nigeria, said in a statement, “Continued demand for mobile connectivity along with increased consumption of data requires reliable and effective networks that are also cost efficient for network operators. The decision to sell our passive infrastructure to an experienced commercial partner, such as IHS, is part of our strategy to increase network coverage and capacity which is already rated number 1 for quality of service by the Nigerian Communications Commission.”
Issam Darwish, CEO of IHS, added, “We are delighted to have been trusted by Etisalat Nigeria with their passive network infrastructure. Our market-leading operations team, managed through a state-of-the-art network operations centre and our continual investment in better, more efficient systems and technologies will ensure that that trust is well-placed.
This partnership will provide significant long-term benefits to Etisalat Nigeria, allowing them to focus entirely on marketing new customer propositions to a wider market.”
