Airtel’s tower sale has driven African towercos to the tipping point; achieving scale and diversification of country and counterparty risk. TowerXchange expect the last of the Airtel African towers to be sold by the end of Q2 2015, raising ~$2.5bn. All the towers have been sold on a pure sale and leaseback basis, with the respective towercos acquiring 100% equity in Airtel’s African towers. Here’s how TowerXchange understand the Airtel towers are going to be divided among the towercos, in the process drawing Helios Towers Africa, Eaton Towers and American Tower into several new countries.
TowerXchange understand that Helios Towers Africa has added 3,100 of Airtel’s towers to their existing assets, including all of Airtel’s towers in Tanzania and DRC, where Helios Towers Africa is the sole towerco and is marketing significantly more than half of each country’s towers. We believe Helios Towers Africa will enter new markets in Chad, Congo Brazzaville, with Gabon perhaps to follow soon.
We think the 3,500 Airtel towers acquired by Eaton and announced recently includes the towers in existing markets Ghana, Uganda and Kenya, plus new markets Niger, Burkina Faso and Malawi, with Madagascar likely to follow.
Paying approximately US$181mn for 1,113 towers, IHS has added Airtel’s towers in Rwanda and Zambia to those they acquired from MTN, making IHS the only towerco in both markets, owning significantly more than half each country’s towers. IHS also owns 56% of Nigeria’s towers, having acquired assets from MTN and Etisalat, although the Airtel Nigeria towers will be sold to American Tower for a little over US$1bn.
TowerXchange understand that Airtel will retain their towers in Sierra Leone, where their enthusiasm that Africell not co-locate on their towers made a tower sale untenable.
The Airtel tower sale could trigger further tower transactions as the other operators in affected countries realise that their towers are at risk of becoming stranded assets – if they’re ever going to sell, they need to sooner rather than later.
It may be noteworthy that Airtel’s Q3 2014 report stated that the company had 17,935 sites across Africa (491 more than the same time last year), of which 8,104 had a 3G antenna (up 1,867 YOY).
TowerXchange has written extensively about Airtel’s African tower sale. We forecasted which assets would be transferred to which towerco, and provided a snapshot of each tower market – for detailed analyses see “TowerXchange’s forecast for how the Airtel towers will be distributed among Africa’s ‘Big Four’ towercos” on pages 13-21 of issue 10 of the TowerXchange Journal.
Here is the updated map of the Airtel African tower sale. Note that specific details of which country’s towers have been sold to which towerco is not yet in the public domain, however TowerXchange sources strongly intimate that this will be “the lay of the land” when the dust settles on the deal.
