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How Vodafone Ghana secured investment in their legacy infrastructure, reduced opex AND kept their towers through an operational lease deal

Congratulations to IHS Africa on their acquisition of 1,758 towers from MTN in Cote d’Ivoire and Cameroon. The cost per tower is US$151.5k in Cote d’Ivoire (US$141m purchase price) and US$173k in Cameroon (US$143m). While one needs to know the lease rate to evaluate the deal properly, industry commentators agree that MTN realized a good price, while IHS Africa have paid a justifiable premium to cement their place among the most credible independent tower companies in Africa. Indeed, this deal makes IHS Africa the largest independent tower company in West Africa with a presence in the four largest economies in the region; Nigeria, Ghana, Cameroon and Cote d’Ivoire. Unlike MTN’s previous joint venture deals with American Tower in Ghana and Uganda, in which they retained a substantial equity stake, MTN has parted with 100% of the equity in Cote d’Ivoire and Cameroon. As usual, MTN becomes an anchor tenant. IHS Africa has made build-to-suit commitments. The initial term is 10 years. Citibank served as MTN’s advisers on the deal. The transactions are expected to close during the first quarter of 2013, subject to the usual closing conditions.

Steve Evans, Chief Executive Officer of Etisalat Nigeria, said that the company would be investing more in 2G networks in rural areas and in 3G networks in urban centres in 2013. With about 3,500 base stations across Nigeria, Etisalat is targeting 20 million active subscribers by the end of 2013. According to NCC figures, Etisalat had 14.4m subscribers in September 2012.

The grapevine is buzzing that the next infrastructure sharing transactions could take place in the massive and fiercely competitive South African and Nigerian markets

Orange is considering selling 600 towers in Kenya. A senior executive at the operator admitted Orange had “launched a process looking at different scenarios to optimise costs in Kenya.”

In order to finance their deals in Cameroon and Cote d’Ivoire, and development in Nigeria, IHS Africa has announced the sale of 25% equity for $125m to European investment firm Wendel and its subsidiary Oranje-Nassau. This continues IHS’s efforts to raise US$400m to finance their ongoing African business development.

How Orange leveraged infrastructure sharing to claim data market leadership in Uganda

How the experts conduct due diligence on tower portfolios to evaluate potential investments

How to evaluate the design, foundations, and loading of towers to determine current capacity and required strengthening to add additional tenants

TowerXchange spoke to Ganges Internationale to get some advice how to build, buy and upgrade towers for multiple tenants