MTN Group is seeking Nigerian investors to take over 30 per cent stake in IHS Nigeria, to enable the group conclude the acquisition of IHS Holding Limited that is expected to reach between $900 million and $1.1 billion.
Bloomberg, which reported the development, cited sources familiar with the development who asked not to be quoted because the details are private.
Ralph Mupita, MTN Group chief executive officer, said proceeds from any sell-down would be used to reduce debt related to IHS.
“The deal would be done on market-oriented valuation basis,” Mupita said in an interview, declining to provide financial details.
Diaspora Digital Media understand that MTN had agreed to sell part of its interest in IHS Nigeria to local entities under an arrangement with Nigeria’s competition regulator.
The proposed sale of a 30 percent stake to local investors forms part of MTN’s compliance with regulatory requirements in Nigeria.
MTN, earlier this year, announced plans to acquire about 75 percent of IHS Nigeria it did not already own, consolidating its position in the tower company.
MTN said the transaction would result in the group owning 100 percent of IHS’ African tower portfolio, following the completion of IHS’ announced disposals of its Latin American fibre and tower businesses.
The telecoms giant noted that the offer price was $8.5 per share, representing a 9.7 percent premium to IHS’s 30-day volume-weighted average price as of February 4 – the last trading day before MTN issued a cautionary notice.
IHS Nigeria operates about 18,000 telecommunications towers that support mobile network infrastructure across the country.
IHS, which started operations in 2001 from Nigeria, and was founded by Sam Darwish, grew to become one of the largest independent owners, operators and developers of shared communications infrastructure in the world.
Meanwhile, MTN and IHS have maintained a longstanding relationship in the telecoms’ infrastructure market, with MTN selling thousands of its telecom towers to IHS through sale-and-leaseback arrangements over the years.
