Millicom extends Helios partnership to DRC

Developing markets specialist operator Millicom has struck a deal with African tower firm Helios Towers that will see ownership of 729 of the towers in its network in the Republic of the Congo (DRC) transferred to Helios. Under the deal, Millicom’s local operation Tigo will receive at least $45m in cash upfront and retain a significant minority interest in Helios’ own DRC subsidiary, Helios Towers DRC (HTD).

The model is a familiar one to both parties, with a similar deal being struck between the two in Tanzania earlier this month and in Ghana at the start of the year. The two firms have entered into a long-term leasing agreement that will see HTD provide Tigo DRC with access to its portfolio of towers and a build-to-suit agreement to support the firm’s further growth. Meanwhile, as in previous deals, HTD will look to strike similar deals with Tigo’s competitors in a bid to build economies of scale.

Mikael Grahne, President and CEO of Millicom, said: “This is Millicom’s third such deal with Helios in Africa and it brings us to a point where nearly two-thirds of our towers in Africa are committed to be outsourced. We are confident that this and similar previously announced ventures will continue to produce satisfactory results and improved service  levels as we have experienced in Ghana since the creation of the first tower joint venture in Africa with Helios in January 2010. These agreements, and any future sale of our remaining towers in Africa, will enable us to improve both our capital and operating efficiency by focusing on our core activities of sales, marketing, branding, distribution, service innovation and customer care.”

“With this latest transaction with Millicom in DRC, HTA is firmly established as the leading independent tower  company in Africa. Under increasingly competitive conditions in many African markets, HTA enables wireless operators to outsource non-core tower-related activities and focus capital and management resources on providing higher quality services more cost-effectively,” said Helios CEO Charles Green.