IHS to take over MTN Nigeria's towers through joint venture

African tower management specialist IHS Holding (IHS) announced today it has agreed in principle on a joint venture to form a new towers company with operator MTN.

Under the deal, which is expected to reduce MTN’s operational cost, boost network efficiency and expand its voice and data capacity, IHS will have full operational control of MTN’s 9,151 mobile network towers in Nigeria.

The news follows recently reported developments on tower sharing in Africa, and the new IHS and MTN venture, expected to be finalised by the end of Q4 pending regulatory approvals, will also market infrastructure sharing services to other mobile operators and ISPs in Nigeria.

Michael Ikpoki, CEO of MTN Nigeria commented on the transaction: “The separation of MTN Nigeria’s mobile network towers and operation of the underlying towers business by IHS reflects a major part of our strategy to optimise network quality and technological assets towards creating value and driving innovation to meet our customers’ needs now and in the long term. Indeed, the trends and realities in our industry reveal the increased role of cost efficiency and optimisation of assets in guiding business decisions in order to remain competitive.”

Under the agreement, the new towers company also commits to $500 million additional investment for tower upgrades and maintenance over four years to improve MTN Nigeria’s service, as well as further investment into IHS’s network.

Issam Darwish, CEO of IHS, said: “This is a significant and transformational agreement for IHS that doubles the size of our business and confirms our position as the leading mobile infrastructure company in Africa.”

This new agreement is the latest in a series of five such deals between IHS and MTN, and if approved IHS will have some 20,000 towers under its control in Africa. Very likely this venture is not the last of its kind for IHS as the company has set itself a target of managing 25,000 towers in the region by the end of 2015.